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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2015 |
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
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Delaware
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98-0526415
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. employer identification number)
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111 Duke Street, Suite 5000; Montréal, Quebec; Canada H3C 2M1
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(Address of principal executive offices) (Zip Code)
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(514) 875-2515
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Common Stock, par value $0.001 per share
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New York Stock Exchange
Toronto Stock Exchange
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(Title of class)
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(Name of exchange on which registered)
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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Name
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Age
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Position
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Since
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Richard Garneau
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68
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President and Chief Executive Officer
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2011
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Pierre Laberge
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59
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Senior Vice President, Human Resources
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2011
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Yves Laflamme
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59
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Senior Vice President, Wood Products, Procurement and Information Technology
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2007
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Jo-Ann Longworth
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55
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Senior Vice President and Chief Financial Officer
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2011
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André Piché
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57
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Senior Vice President, Tissue Group, and Calhoun, Catawba and Mokpo Operations
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2014
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Richard Tremblay
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52
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Senior Vice President, Pulp and Paper Group
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2014
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Jacques P. Vachon
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56
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Senior Vice President, Corporate Affairs and Chief Legal Officer
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2007
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Number of Machines
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2016
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2015
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2015 Production By Product Line
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|||||||||||||||
(In thousands of metric tons)
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Total
Capacity
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Total
Production
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Market
Pulp
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Tissue
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Newsprint
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Specialty
Papers
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|||||||||||||
Canada
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||||||
Alma, Quebec
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3
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341
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318
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—
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—
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—
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318
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Amos, Quebec
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1
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196
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193
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—
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—
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193
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—
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Baie-Comeau, Quebec
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2
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323
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319
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—
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—
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319
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—
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Clermont, Quebec
(1)
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1
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220
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218
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—
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—
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218
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—
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Dolbeau, Quebec
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1
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143
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139
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—
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—
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—
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139
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Gatineau, Quebec
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1
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193
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193
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—
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—
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193
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—
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Kénogami, Quebec
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1
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136
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133
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—
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—
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—
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133
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Saint-Félicien, Quebec
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—
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356
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335
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335
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—
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—
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—
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Thorold, Ontario
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1
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197
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129
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—
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—
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129
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—
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Thunder Bay, Ontario
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1
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560
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495
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300
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—
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195
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—
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United States
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||||||
Augusta, Georgia
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2
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397
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384
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—
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—
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384
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—
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Calhoun, Tennessee
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3
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661
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516
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57
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—
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70
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389
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Catawba, South Carolina
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2
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721
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677
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210
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—
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—
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467
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Coosa Pines, Alabama
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—
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268
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261
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261
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—
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—
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—
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Fairmont, West Virginia
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—
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218
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133
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133
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—
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—
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—
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Grenada, Mississippi
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1
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246
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225
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—
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—
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225
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—
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Hialeah, Florida
(2)
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2
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33
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4
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—
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4
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—
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—
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Menominee, Michigan
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—
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178
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120
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120
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—
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—
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—
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Sanford, Florida
(2)
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1
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24
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3
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—
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3
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—
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—
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Usk, Washington
(3)
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1
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235
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169
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—
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—
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169
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—
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South Korea
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Mokpo, South Korea
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1
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200
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188
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—
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—
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188
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—
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Other
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Permanently closed facilities and paper machines
(4)
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14
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—
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—
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14
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—
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25
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5,846
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5,166
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1,416
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7
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2,297
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1,446
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(1)
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Donohue Malbaie Inc. is located in Clermont and is a consolidated subsidiary in which we have a 51% interest. The amounts in the above table represent the mill’s total capacity and production.
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(2)
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On November 16, 2015, we acquired Atlas Paper, a manufacturer of a range of tissue products for the away-from-home and private-label at-home markets, including virgin and recycled products, covering economy, value and premium grades.
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(3)
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Ponderay Newsprint Company is located in Usk and is an unconsolidated partnership in which we have a 40% interest. The amounts in the above table represent the mill’s total capacity and production.
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(4)
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In 2015, we permanently closed a paper machine in Clermont. For additional information, see
Note 4, “Closure Costs, Impairment and Other Related Charges
,” to our Consolidated Financial Statements.
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2016
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2015
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(In million board feet)
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Total Capacity
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Total Production
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||||
Atikokan, Ontario
(1)
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145
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15
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Comtois, Quebec
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145
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106
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Girardville, Quebec
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218
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205
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Ignace, Ontario
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115
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50
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La Doré, Quebec
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190
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188
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La Tuque, Quebec
(2)
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175
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77
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Maniwaki, Quebec
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160
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92
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Mistassini, Quebec
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175
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171
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Obedjiwan, Quebec
(3)
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65
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49
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Pointe-aux-Outardes, Quebec
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175
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120
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Saint-Félicien, Quebec
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160
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123
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Saint-Hilarion, Quebec
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85
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33
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Saint-Ludger-de-Milot, Quebec
(4)
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11
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|
|
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103
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Saint-Thomas, Quebec
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75
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|
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71
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Senneterre, Quebec
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155
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92
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Thunder Bay, Ontario
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302
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302
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2,351
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1,797
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(1)
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On June 1, 2015, our Atikokan sawmill started the ramp-up process of its operations.
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(2)
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Forest Products Mauricie L.P. is located in La Tuque and is a consolidated subsidiary in which we have a 93.2% interest. The amounts in the above table represent the mill’s total capacity and production.
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(3)
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Sociéte en Commandite Scierie Opitciwan is located in Obedjiwan and is an unconsolidated entity in which we have a 45% interest. The amounts in the above table represent the mill’s total capacity and production.
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(4)
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On February 1, 2016, we sold our interest in Produits Forestiers Petit-Paris Inc., an unconsolidated entity located in Saint-Ludger-de-Milot in which we had a 50% interest. The amounts in the above table represent the mill’s total production and capacity through February 1, 2016.
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2016
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2015
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||||
(In million board feet, except where otherwise stated)
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Total Capacity
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Total Production
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||||
Remanufactured Wood Products Facilities
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Château-Richer, Quebec
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66
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66
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La Doré, Quebec
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16
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15
|
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Total Remanufacturing Wood Facilities
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82
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|
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81
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Engineered Wood Products Facilities
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Larouche and Saint-Prime, Quebec (in million linear feet)
(1)
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145
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102
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Wood Pellet Products Facility
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Thunder Bay, Ontario (in thousands of metric tons)
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|
45
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33
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(1)
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Abitibi-LP Engineered Wood Inc. and Abitibi-LP Engineered Wood II Inc. are located in Larouche and Saint-Prime, respectively, and are unconsolidated entities in which we have a 50% interest in each entity. We operate the facilities and our joint venture partners sell the products. The amounts in the above table represent the mills’ total capacity and production.
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ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
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High
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Low
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||||||
2014
|
|
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First quarter
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$
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21.70
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|
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$
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15.96
|
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Second quarter
|
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20.15
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|
|
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14.73
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Third quarter
|
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18.24
|
|
|
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14.77
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Fourth quarter
|
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19.38
|
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15.30
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2015
|
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First quarter
|
$
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19.26
|
|
|
$
|
15.26
|
|
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Second quarter
|
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18.45
|
|
|
|
10.86
|
|
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Third quarter
|
|
11.80
|
|
|
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8.14
|
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Fourth quarter
|
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10.60
|
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6.65
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Years Ended December 31,
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||||||||||||||||||||||||
(In millions, except per share amounts)
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2015
|
|
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2014
|
|
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2013
|
|
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2012
|
|
|
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2011
|
|
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|||||
Statement of Operations Data
|
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||||||||||
Sales
|
|
$
|
3,645
|
|
|
|
$
|
4,258
|
|
|
|
$
|
4,461
|
|
|
|
$
|
4,503
|
|
|
|
$
|
4,756
|
|
|
Operating (loss) income
|
|
(219
|
)
|
|
|
(174
|
)
|
|
|
(2
|
)
|
|
|
(28
|
)
|
|
|
207
|
|
|
|||||
Net (loss) income including noncontrolling interests
|
|
(255
|
)
|
|
|
(274
|
)
|
|
|
(639
|
)
|
|
|
(33
|
)
|
|
|
45
|
|
|
|||||
Net (loss) income attributable to Resolute Forest Products Inc.
|
|
(257
|
)
|
|
|
(277
|
)
|
|
|
(639
|
)
|
|
|
1
|
|
|
|
47
|
|
|
|||||
Basic net (loss) income per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(2.78
|
)
|
|
|
(2.93
|
)
|
|
|
(6.75
|
)
|
|
|
0.01
|
|
|
|
0.48
|
|
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|||||
Diluted net (loss) income per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(2.78
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)
|
|
|
(2.93
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)
|
|
|
(6.75
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)
|
|
|
0.01
|
|
|
|
0.48
|
|
|
|||||
Dividends declared per common share
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|||||
Segment Sales Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
||||||||||
Market pulp
|
|
$
|
889
|
|
|
|
$
|
974
|
|
|
|
$
|
1,053
|
|
|
|
$
|
814
|
|
|
|
$
|
659
|
|
|
Tissue
|
|
11
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|||||
Wood products
|
|
536
|
|
|
|
610
|
|
|
|
569
|
|
|
|
500
|
|
|
|
468
|
|
|
|||||
Newsprint
|
|
1,105
|
|
|
|
1,402
|
|
|
|
1,473
|
|
|
|
1,627
|
|
|
|
1,816
|
|
|
|||||
Specialty papers
|
|
1,104
|
|
|
|
1,272
|
|
|
|
1,366
|
|
|
|
1,562
|
|
|
|
1,813
|
|
|
|||||
|
|
$
|
3,645
|
|
|
|
$
|
4,258
|
|
|
|
$
|
4,461
|
|
|
|
$
|
4,503
|
|
|
|
$
|
4,756
|
|
|
Statement of Cash Flows Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities
|
|
$
|
138
|
|
|
|
$
|
186
|
|
|
|
$
|
206
|
|
|
|
$
|
266
|
|
|
|
$
|
198
|
|
|
Cash invested in fixed assets
|
|
185
|
|
|
|
193
|
|
|
|
161
|
|
|
|
169
|
|
|
|
97
|
|
|
|
December 31,
|
||||||||||||||||||||||||
(In millions, except otherwise indicated)
|
|
2015
|
|
|
|
2014
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|||||
Financial Position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed assets, net
|
|
$
|
1,810
|
|
|
|
$
|
1,985
|
|
|
|
$
|
2,289
|
|
|
|
$
|
2,440
|
|
|
|
$
|
2,502
|
|
|
Total assets
|
|
4,220
|
|
|
|
4,914
|
|
|
|
5,377
|
|
|
|
6,333
|
|
|
|
6,304
|
|
|
|||||
Total debt
(1)
|
|
591
|
|
|
|
590
|
|
|
|
591
|
|
|
|
534
|
|
|
|
621
|
|
|
|||||
Additional Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Number of employees
|
|
8,000
|
|
|
|
7,700
|
|
|
|
8,400
|
|
|
|
9,300
|
|
|
|
10,400
|
|
|
(1)
|
In 2012 and 2011, we redeemed $85 million and $264 million, respectively, of principal amount of our senior secured notes due in 2018 (the “2018 Notes”). In 2013, we issued $600 million aggregate principal of 2023 Notes and used the proceeds to redeem the remaining $501 million of principal amount of the 2018 Notes. For additional information, see
Note 12, “Long-Term Debt
,” to our Consolidated Financial Statements.
|
•
|
Competitive cost structure
- as a result of aggressive cost reductions and mill rationalizations, today we compete as a leading, lower-cost North American producer. Maintaining this competitive advantage is our key focus. We are committed to maximizing shareholder value and earnings power by: stressing our guiding principles of operational excellence in everything we do; pushing to optimize our asset base in order to maximize the utilization of our most cost-effective mills; and streamlining production to adapt to changing market dynamics.
|
•
|
Financial strength
- we make disciplined capital management a priority; we believe in maintaining a flexible and conservative capital structure. Our financial strength gives us the ability to consider a range of suitable opportunities, and the patience to make sure the valuation is right.
|
•
|
Synergistic and diversified asset base
- we apply our principles of operational excellence to our synergistic and diversified asset base, one that has evolved with time as we execute our gradual retreat from certain paper grades toward more sustainable long-term businesses. Put simply, we use cash flow from our optimized paper segments to grow our business for the long-term, including: the tissue manufacturing and converting facility scheduled for ramp-up in 2017; the two tissue mills and the three pulp mills we acquired in 2015 and 2012, respectively; the capacity enhancement initiatives in wood products; and the continuous pulp digester project at the Calhoun, Tennessee, pulp and paper facility. This synergistic and complementary asset base also offers the fiber management advantage of integration and earnings diversification.
|
|
Years Ended December 31,
|
|||||||||||
|
2015
|
2014
|
2013
|
|||||||||
Sales
|
|
|
|
|
|
|
|
|
|
|||
Market pulp
|
|
25
|
%
|
|
|
23
|
%
|
|
|
23
|
%
|
|
Tissue
|
|
—
|
%
|
|
|
—
|
%
|
|
|
—
|
%
|
|
Wood products
|
|
15
|
%
|
|
|
14
|
%
|
|
|
13
|
%
|
|
Newsprint
|
|
30
|
%
|
|
|
33
|
%
|
|
|
33
|
%
|
|
Specialty papers
|
|
30
|
%
|
|
|
30
|
%
|
|
|
31
|
%
|
|
Total (%)
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
Total sales (
$ millions
)
|
$
|
3,645
|
|
|
$
|
4,258
|
|
|
$
|
4,461
|
|
|
•
|
leveraging our lower-cost position;
|
•
|
maintaining a stringent focus on reducing costs and optimizing our diversified asset base;
|
•
|
maximizing the benefits of our access to virgin fiber and managing our exposure to volatile recycled fiber; and
|
•
|
pursuing our strategy of managing production and inventory levels and focusing production at our most profitable and lower-cost facilities and machines.
|
•
|
We believe we have one of the lowest selling, general and administrative expenses (or “
SG&A
”) to sales ratio in the forest product industry.
|
•
|
We have reduced a number of positions at mill sites since 2012, without affecting operating capacity, which has significantly lowered our labor costs.
|
•
|
Maintaining our strong financial position and financial flexibility is one of our primary financial goals. In 2013, we refinanced the remaining balance of our senior secured notes with 5.875% senior unsecured notes due 2023 (or the “
2023 notes
”). In addition to adding five years to maturity, the refinancing reduced our annual cash interest burden by $16 million and improves our financial flexibility.
|
•
|
Also, in 2015, we refinanced our senior secured asset-based revolving credit facility (or “
ABL credit facility
”). The new five-year credit agreement provides more flexible terms and conditions, improves pricing and immediately lowers our cost of capital, to better support the execution of our growth and diversification initiatives.
|
•
|
In 2014, we modified our U.S. other postretirement benefit (or “
OPEB
”) plans to encourage greater participation in a Medicare Exchange program. In addition to securing high-quality healthcare for participants, this modification, along with similar initiatives undertaken since mid-2013, helped to reduce our U.S. OPEB liability on the balance sheet from $250 million to $77 million as of December 31, 2014.
|
•
|
Since 2012, we repurchased 11.1 million shares of our own stock, representing about 12% of the outstanding amount.
|
•
|
By acquiring Fibrek Inc. in 2012, we grew our market pulp capacity by over 70%, increasing our presence in a market that we believe will continue to grow over the long term.
|
•
|
Including our new Ignace and Atikokan sawmills, both in Northern Ontario, we added 300 million board feet of annualized wood products capacity in 2015.
|
•
|
We completed a $100 million project to build a continuous pulp digester at the Calhoun pulp and paper mill. When the digester reaches capacity, we expect to have an additional 100,000 metric tons of market pulp available on an annualized basis. We believe this world-class equipment will help to significantly lower the mill’s overall costs and improve the quality of its products.
|
•
|
We announced and began construction toward a $270 million project to build a tissue manufacturing and converting facility in Calhoun.
|
•
|
With the acquisition of Atlas Paper in 2015, we gained an immediate position in the North American consumer tissue market and tissue industry experience for the execution of the Calhoun tissue expansion.
|
•
|
improving resource efficiency, which helps control fiber and power costs, two significant input costs in our industry;
|
•
|
moving beyond regulatory compliance and environmental incident management to differentiate ourselves as an environmental supplier of choice;
|
•
|
positioning ourselves as a competitive employer in order to attract, engage and retain the best and brightest minds, promoting employee engagement, innovation and longevity; and
|
•
|
building solid community relations to support long-term regional prosperity and our own financial and operational success.
|
•
|
We are proud that in 2015 we beat our ambitious safety target, achieving an Occupational Safety and Health Administration incident rate of 0.66, improving upon the world class rate of 0.83 we achieved in 2014. Safety is our first priority, and we strive for zero injuries.
|
•
|
In 2013, we surpassed, two years ahead of schedule, the goal we set as a member of the World Wildlife Fund Climate Savers program to reduce our absolute scope 1 (on-site emissions) and 2 (emissions associated with steam and electricity purchased) greenhouse gas emissions by 65% by 2015, compared to 2000 levels. At the end of 2015, we had reduced our emissions by 70%. This improvement goes beyond capacity reductions: over 50% of the improvement came from reductions in energy consumption, fuel switching and fuel mix improvements. 2015 also marked the Company’s first full year of 100% scope 1 coal-free operation.
|
•
|
Maintaining 100% certification of Resolute-owned or managed woodlands to internationally recognized forest management standards. 100% of our managed forests have been certified to one or more of two standards (Sustainable Forestry Initiative
®
and/or Forest Stewardship Council
®
). Accordingly, our commitments extend well beyond strict compliance with applicable forestry regulations, which in Quebec and Ontario are already among the most, if not the most, rigorous in the world.
|
•
|
We reduced our mill environmental incidents by 55% in 2015 compared to 2014.
|
•
|
Through 2016, continuing to implement new human resource practices to support workforce renewal and retention, and engaging employees in the Company’s sustainability-focused vision and values.
|
•
|
In addition to developing information resources such as
BorealForestFacts.com
and The Resolute Blog, we continued engagement on the Forum boréal and Boreal Forum social media platforms. These French and English sites provide a forum for fact-based discussion concerning sustainable forestry practices and they help to ensure that individual and community voices are heard, particularly when it comes to the importance of forestry to Northern economies.
|
•
|
Other sustainability performance indicators and disclosures prepared in accordance with the Global Reporting Initiative (or “
GRI
”) G4 guidelines are available on our website (www.resolutefp.com). The GRI framework is considered the gold standard of balanced, transparent sustainability reporting, and the Company is proud to be among the first in the forest products industry globally to meet the GRI G4 reporting standards.
|
•
|
the International Business Award (known as the “Stevies
®
”), the world’s premier business awards program, in the Health, Safety and Environment Program of the Year category for establishing a “total safety organization”;
|
•
|
Canada’s Clean50 award, which recognized a team of four Resolute employees for their roles in greatly reducing the Company’s environmental incidents and greenhouse gas emissions, as well as completing environmental due diligence training, reporting on scope 3 emissions (from the supply chain), and achieving maximum achievable control technology boiler compliance;
|
•
|
the American Forest & Paper Association Leadership in Sustainability Award for Safety for “Working Towards Zero Incidents” and for developing better-performing and more efficient safety gear; and
|
•
|
the Best in Biz silver award for being North America’s Most Socially or Environmentally Responsible Company of the Year in recognition of our work to minimize our resource consumption; our efforts to reduce our generation of waste, air emissions and water discharge; our proactive approach to reducing environmental incidents; our commitment to 100% woodland certification; our transparent sustainability reporting; and our innovative partnerships with First Nations.
|
Year Ended December 31, 2015
|
Operating
Income (Loss) |
Net
Income (Loss) |
EPS
|
|
|
|||||||
(Unaudited, in millions, except per share amounts)
|
||||||||||||
GAAP, as reported
|
$
|
(219
|
)
|
|
$
|
(257
|
)
|
|
$
|
(2.78
|
)
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
—
|
|
|
|
4
|
|
|
|
0.04
|
|
|
Closure costs, impairment and other related charges
|
|
181
|
|
|
|
181
|
|
|
|
1.96
|
|
|
Inventory write-downs related to closures
|
|
2
|
|
|
|
2
|
|
|
|
0.02
|
|
|
Start-up costs
|
|
5
|
|
|
|
5
|
|
|
|
0.06
|
|
|
Non-operating pension and OPEB costs
|
|
66
|
|
|
|
66
|
|
|
|
0.72
|
|
|
Acquisition-related costs
|
|
4
|
|
|
|
4
|
|
|
|
0.04
|
|
|
Other income, net
|
|
—
|
|
|
|
(8
|
)
|
|
|
(0.09
|
)
|
|
Income tax effect of special items
|
|
—
|
|
|
|
(21
|
)
|
|
|
(0.23
|
)
|
|
GAAP, as adjusted for special items
(1)
|
$
|
39
|
|
|
$
|
(24
|
)
|
|
$
|
(0.26
|
)
|
|
Year Ended December 31, 2014
|
Operating
Income (Loss) |
Net
Income (Loss) |
EPS
|
|
|
|||||||
(Unaudited, in millions, except per share amounts)
|
||||||||||||
GAAP, as reported
|
$
|
(174
|
)
|
|
$
|
(277
|
)
|
|
$
|
(2.93
|
)
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
—
|
|
|
|
32
|
|
|
|
0.34
|
|
|
Closure costs, impairment and other related charges
|
|
278
|
|
|
|
278
|
|
|
|
2.94
|
|
|
Inventory write-downs related to closures
|
|
17
|
|
|
|
17
|
|
|
|
0.18
|
|
|
Start-up costs
|
|
4
|
|
|
|
4
|
|
|
|
0.04
|
|
|
Net gain on disposition of assets
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
(0.02
|
)
|
|
Non-operating pension and OPEB credits
|
|
(10
|
)
|
|
|
(10
|
)
|
|
|
(0.11
|
)
|
|
Write-down of equity method investment
|
|
—
|
|
|
|
61
|
|
|
|
0.65
|
|
|
Other income, net
|
|
—
|
|
|
|
(10
|
)
|
|
|
(0.11
|
)
|
|
Income tax effect of special items
|
|
—
|
|
|
|
(54
|
)
|
|
|
(0.57
|
)
|
|
GAAP, as adjusted for special items
(1)
|
$
|
113
|
|
|
$
|
39
|
|
|
$
|
0.41
|
|
|
(1)
|
Operating income (loss), net income (loss) and net income (loss) per share (or “
EPS
”), in each case as adjusted for special items, are not financial measures recognized under generally accepted accounting principles, or “
GAAP.
” We calculate operating income (loss), as adjusted for special items, as operating income (loss) from our Consolidated Statements of Operations, adjusted for items such as closure costs, impairment and other related charges, inventory write-downs related to closures, start-up costs, gains and losses on disposition of assets, non-operating pension and OPEB costs and credits, acquisition-related costs, and other charges or credits that are excluded from our segment’s performance from GAAP operating income (loss). We calculate net income (loss), as adjusted for special items, as net income (loss) from our Consolidated Statements of Operations, adjusted for the same special items applied to operating income (loss), in addition to foreign exchange translation gains and losses, write-down of equity method investment, other income (expense), net, and the income tax effect of the special items. EPS, as adjusted for special items, is calculated as net income (loss), as adjusted for special items, per diluted share. We believe that using these non-GAAP measures is useful because they are consistent with the indicators management uses internally to measure the Company’s performance, and it allows the reader to more easily compare our operations and financial performance from period to period. Operating income (loss), net income (loss) and EPS, in each case as adjusted for special items, are internal measures, and therefore may not be comparable to those of other companies. These non-GAAP measures should not be viewed as substitutes to financial measures determined under GAAP.
|
Three Months Ended December 31, 2015
|
Operating
Income (Loss) |
Net
Income (Loss) |
EPS
|
|
|
|||||||
(Unaudited, in millions, except per share amounts)
|
||||||||||||
GAAP, as reported
|
$
|
(226
|
)
|
|
$
|
(214
|
)
|
|
$
|
(2.39
|
)
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
—
|
|
|
|
2
|
|
|
|
0.02
|
|
|
Closure costs, impairment and other related charges
|
|
173
|
|
|
|
173
|
|
|
|
1.94
|
|
|
Inventory write-downs related to closures
|
|
1
|
|
|
|
1
|
|
|
|
0.01
|
|
|
Start-up costs
|
|
1
|
|
|
|
1
|
|
|
|
0.01
|
|
|
Non-operating pension and OPEB costs
|
|
27
|
|
|
|
27
|
|
|
|
0.30
|
|
|
Acquisition-related costs
|
|
4
|
|
|
|
4
|
|
|
|
0.04
|
|
|
Other income, net
|
|
—
|
|
|
|
(1
|
)
|
|
|
(0.01
|
)
|
|
Income tax effect of special items
|
|
—
|
|
|
|
(19
|
)
|
|
|
(0.21
|
)
|
|
GAAP, as adjusted for special items
(1)
|
$
|
(20
|
)
|
|
$
|
(26
|
)
|
|
$
|
(0.29
|
)
|
|
Three Months Ended December 31, 2014
|
Operating
Income (Loss) |
Net
Income (Loss) |
EPS
|
|
|
|||||||
(Unaudited, in millions, except per share amounts)
|
||||||||||||
GAAP, as reported
|
$
|
(93
|
)
|
|
$
|
(109
|
)
|
|
$
|
(1.15
|
)
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
—
|
|
|
|
18
|
|
|
|
0.19
|
|
|
Closure costs, impairment and other related charges
|
|
131
|
|
|
|
131
|
|
|
|
1.38
|
|
|
Inventory write-downs related to closures
|
|
7
|
|
|
|
7
|
|
|
|
0.07
|
|
|
Start-up costs
|
|
2
|
|
|
|
2
|
|
|
|
0.02
|
|
|
Non-operating pension and OPEB credits
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
(0.02
|
)
|
|
Write-down of equity method investment
|
|
—
|
|
|
|
11
|
|
|
|
0.12
|
|
|
Other income, net
|
|
—
|
|
|
|
(4
|
)
|
|
|
(0.04
|
)
|
|
Income tax effect of special items
|
|
—
|
|
|
|
(19
|
)
|
|
|
(0.20
|
)
|
|
GAAP, as adjusted for special items
(1)
|
$
|
45
|
|
|
$
|
35
|
|
|
$
|
0.37
|
|
|
(1)
|
Operating income (loss), net income (loss) and EPS, in each case as adjusted for special items, are non-GAAP financial measures. For more information on the calculation and reasons we include these measures, see note 1 under “
Overview –
2015
Overview
” above.
|
|
As of December 31,
|
|||||||
(In millions)
|
2015
|
2014
|
||||||
Cash and cash equivalents
|
$
|
58
|
|
|
$
|
337
|
|
|
Total assets
|
|
4,220
|
|
|
|
4,914
|
|
|
(1)
|
Earnings before interest expense, income taxes, and depreciation and amortization, or “
EBITDA
”, adjusted EBITDA and adjusted EBITDA margin are not financial measures recognized under GAAP. EBITDA is calculated as net income (loss) including noncontrolling interests from the Consolidated Statements of Operations, adjusted for interest expense, income taxes, and depreciation and amortization. Adjusted EBITDA means EBITDA, excluding special items, such as foreign exchange translation gains and losses, closure costs, impairment and other related charges, inventory write-downs related to closures, start-up costs, gains and losses on disposition of assets, non-operating pension and OPEB costs and credits, write-down of equity method investment, net loss on extinguishment of debt, acquisition-related costs and other charges or credits. Adjusted EBITDA margin is adjusted EBITDA expressed as a percentage of sales. We believe that using non-GAAP measures such as EBITDA, adjusted EBITDA and adjusted EBITDA margin is useful because they are consistent with the indicators management uses internally to measure the Company’s performance and it allows the reader to more easily compare our operations and financial performance from period to period. EBITDA, adjusted EBITDA and adjusted EBITDA margin are internal measures, and therefore may not be comparable to those of other companies. These non-GAAP measures should not be viewed as substitutes to financial measures determined under GAAP.
|
(2)
|
Adjusted return on equity, or “
Adjusted ROE
”, is a non-GAAP financial measure, calculated by dividing net income (loss), excluding the special items identified below, by shareholders’ equity, excluding the same special items. Adjusted ROE is a measure of profitability that shows how much profit the Company generated as a percentage of shareholder money invested.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net loss including noncontrolling interests
|
$
|
(255
|
)
|
|
$
|
(274
|
)
|
|
$
|
(639
|
)
|
|
Interest expense
|
|
41
|
|
|
|
47
|
|
|
|
51
|
|
|
Income tax (benefit) provision
|
|
(1
|
)
|
|
|
(30
|
)
|
|
|
524
|
|
|
Depreciation and amortization
|
|
237
|
|
|
|
243
|
|
|
|
243
|
|
|
EBITDA
|
$
|
22
|
|
|
$
|
(14
|
)
|
|
$
|
179
|
|
|
Foreign exchange translation loss
|
|
4
|
|
|
|
32
|
|
|
|
24
|
|
|
Closure costs, impairment and other related charges
|
|
181
|
|
|
|
278
|
|
|
|
89
|
|
|
Inventory write-downs related to closures
|
|
2
|
|
|
|
17
|
|
|
|
11
|
|
|
Start-up costs
|
|
5
|
|
|
|
4
|
|
|
|
32
|
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Non-operating pension and OPEB costs (credits)
|
|
66
|
|
|
|
(10
|
)
|
|
|
5
|
|
|
Write-down of equity method investment
|
|
—
|
|
|
|
61
|
|
|
|
—
|
|
|
Net loss on extinguishment of debt
|
|
—
|
|
|
|
—
|
|
|
|
59
|
|
|
Acquisition-related costs
|
|
4
|
|
|
|
—
|
|
|
|
6
|
|
|
Other income, net
|
|
(8
|
)
|
|
|
(10
|
)
|
|
|
(21
|
)
|
|
Adjusted EBITDA
|
$
|
276
|
|
|
$
|
356
|
|
|
$
|
382
|
|
|
|
December 31, 2015
|
|||||||||||
(In millions, except ROE)
|
Net Loss
|
Shareholders’ Equity
|
ROE (%)
(1)
|
|||||||||
GAAP, as reported
|
$
|
(257
|
)
|
|
$
|
1,932
|
|
|
|
(13.3
|
)%
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
4
|
|
|
|
4
|
|
|
|
|
|
|
Closure costs, impairment and other related charges
|
|
181
|
|
|
|
181
|
|
|
|
|
|
|
Inventory write-downs related to closures
|
|
2
|
|
|
|
2
|
|
|
|
|
|
|
Start-up costs
|
|
5
|
|
|
|
5
|
|
|
|
|
|
|
Non-operating pension and OPEB costs
|
|
66
|
|
|
|
66
|
|
|
|
|
|
|
Acquisition-related costs
|
|
4
|
|
|
|
4
|
|
|
|
|
|
|
Other income, net
|
|
(8
|
)
|
|
|
(8
|
)
|
|
|
|
|
|
Income tax effect of special items
|
|
(21
|
)
|
|
|
(21
|
)
|
|
|
|
|
|
Cumulative past-year adjustments for special items
|
|
—
|
|
|
|
1,279
|
|
|
|
|
|
|
GAAP, as adjusted for special items
|
$
|
(24
|
)
|
|
$
|
3,444
|
|
|
|
(0.7
|
)%
|
|
|
December 31, 2014
|
|||||||||||
(In millions, except ROE)
|
Net (Loss) Income
|
Shareholders’ Equity
|
ROE (%)
(1)
|
|||||||||
GAAP, as reported
|
$
|
(277
|
)
|
|
$
|
2,106
|
|
|
|
(13.2
|
)%
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
32
|
|
|
|
32
|
|
|
|
|
|
|
Closure costs, impairment and other related charges
|
|
278
|
|
|
|
278
|
|
|
|
|
|
|
Inventory write-downs related to closures
|
|
17
|
|
|
|
17
|
|
|
|
|
|
|
Start-up costs
|
|
4
|
|
|
|
4
|
|
|
|
|
|
|
Net gain on disposition of assets
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
Non-operating pension and OPEB credits
|
|
(10
|
)
|
|
|
(10
|
)
|
|
|
|
|
|
Write-down of equity method investment
|
|
61
|
|
|
|
61
|
|
|
|
|
|
|
Other income, net
|
|
(10
|
)
|
|
|
(10
|
)
|
|
|
|
|
|
Income tax effect of special items
|
|
(54
|
)
|
|
|
(54
|
)
|
|
|
|
|
|
Cumulative past-year adjustments for special items
|
|
—
|
|
|
|
963
|
|
|
|
|
|
|
GAAP, as adjusted for special items
|
$
|
39
|
|
|
$
|
3,385
|
|
|
|
1.2
|
%
|
|
|
December 31, 2013
|
|||||||||||
(In millions, except ROE)
|
Net (Loss) Income
|
Shareholders’ Equity
|
ROE (%)
(1)
|
|||||||||
GAAP, as reported
|
$
|
(639
|
)
|
|
$
|
2,827
|
|
|
|
(22.6
|
)%
|
|
Adjustments for special items:
|
|
|
|
|
|
|
|
|
|
|||
Foreign exchange translation loss
|
|
24
|
|
|
|
24
|
|
|
|
|
|
|
Closure costs, impairment and other related charges
|
|
89
|
|
|
|
89
|
|
|
|
|
|
|
Inventory write-downs related to closures
|
|
11
|
|
|
|
11
|
|
|
|
|
|
|
Start-up costs
|
|
32
|
|
|
|
32
|
|
|
|
|
|
|
Net gain on disposition of assets
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
Non-operating pension and OPEB costs
|
|
5
|
|
|
|
5
|
|
|
|
|
|
|
Net loss on extinguishment of debt
|
|
59
|
|
|
|
59
|
|
|
|
|
|
|
Acquisition-related costs
|
|
6
|
|
|
|
6
|
|
|
|
|
|
|
Other income, net
|
|
(21
|
)
|
|
|
(21
|
)
|
|
|
|
|
|
U.S. deferred income tax asset valuation allowance
|
|
604
|
|
|
|
604
|
|
|
|
|
|
|
Income tax effect of special items
|
|
(54
|
)
|
|
|
(54
|
)
|
|
|
|
|
|
Cumulative past-year adjustments for special items
|
|
—
|
|
|
|
210
|
|
|
|
|
|
|
GAAP, as adjusted for special items
|
$
|
114
|
|
|
$
|
3,790
|
|
|
|
3.0
|
%
|
|
(1)
|
Return on equity, or “
ROE
”, is a non-GAAP financial measure, calculated by dividing net income (loss) by shareholders’ equity. ROE is a measure of profitability that shows how much profit the Company generated as a percentage of shareholder money invested.
|
•
|
the effect of asset optimization initiatives, including closure-related write-down of mill stores and other supplies incurred last year ($52 million);
|
•
|
the abnormally cold winter of 2014 ($40 million);
|
•
|
lower maintenance costs and fewer operational disruptions ($25 million);
|
•
|
lower steam costs ($15 million), mainly due to lower natural gas prices;
|
•
|
lower chemical costs ($13 million), mostly related to lower commodity prices;
|
•
|
higher contributions from cogeneration facilities ($9 million);
|
•
|
lower wood chip prices ($8 million); and
|
•
|
favorable property tax adjustments ($8 million);
|
•
|
higher defined benefit pension and OPEB plans costs ($68 million) relating mainly to the amortization of actuarial losses and a settlement charge related to annuity purchases for certain inactive U.S. employees;
|
•
|
higher power costs ($7 million), mostly due to higher power prices in Ontario;
|
•
|
the recognition of an energy saving incentive in the U.S. Southeast in 2014 ($6 million);
|
•
|
an increase in fiber costs ($5 million), partly due to product mix; and
|
•
|
lower tax credits in connection with infrastructure investments ($3 million).
|
•
|
higher defined benefit pension and OPEB plan costs ($28 million) relating mainly to the amortization of actuarial losses and a settlement charge related to annuity purchases for certain inactive U.S. employees; and
|
•
|
the recognition of additional tax credits in connection with infrastructure investments in the year-ago period ($7 million);
|
•
|
the effect of asset optimization initiatives, including closure-related write-down of mill stores and other supplies incurred in the year-ago period ($11 million);
|
•
|
lower steam costs ($6 million), mainly due to lower natural gas prices;
|
•
|
lower fiber costs ($4 million), in part due to lower fuel costs;
|
•
|
fewer operational disruptions ($3 million); and
|
•
|
higher contributions from cogeneration facilities ($3 million).
|
•
|
$57 million of accelerated depreciation, $9 million for severance and other termination benefits and $8 million for other closure costs, including environmental remediation obligations, in connection with the permanent closure of our Iroquois Falls mill in the fourth quarter; and
|
•
|
$32 million of accelerated depreciation and $4 million for other closure costs in connection with the permanent closure of our Laurentide mill.
|
•
|
lower defined benefit pension and OPEB expenses ($34 million);
|
•
|
lower start-up costs ($28 million), the most significant of which were costs incurred in 2013 in connection with the restart of the Gatineau mill;
|
•
|
the recognition of an energy savings incentive in the U.S. Southeast, the recognition of additional tax credits in connection with infrastructure investments and other tax, research and development and insurance credits ($20 million);
|
•
|
the effect of asset optimization initiatives ($17 million);
|
•
|
the full period operation of the Thunder Bay cogeneration assets, partly offset by additional maintenance ($8 million); and
|
•
|
better fiber and chemical costs ($7 million);
|
•
|
the abnormally cold winter ($40 million);
|
•
|
higher stumpage fees and other costs associated with the comprehensive modification of the forest tenure system in the province of Quebec ($17 million);
|
•
|
operational disruptions and higher maintenance costs ($17 million);
|
•
|
asset preservation costs mainly at our closed Fort Frances, Ontario, facility and additional stores inventory write-downs in connection with closures ($16 million);
|
•
|
higher natural gas and power costs ($9 million);
|
•
|
lower contribution from the cogeneration facilities at Dolbeau and Saint-Félicien, because of higher bark costs at one mill and mechanical failures at another ($7 million); and
|
•
|
the timing of business interruption insurance proceeds received in 2013 ($3 million).
|
•
|
the tender premium paid to holders of 2018 notes in the refinancing, net of the write-down of the associated unamortized premium ($59 million); and
|
•
|
a non-cash loss on translation of Canadian dollar net monetary items ($24 million);
|
•
|
the forgiveness of a note payable in connection with our acquisition of a former joint venture partner’s interest in Calhoun Newsprint Company (or “
CNC
”) ($12 million); and
|
•
|
a distribution from the liquidation of a former U.K. subsidiary ($12 million).
|
|
Years Ended December 31,
|
|||||||||||
(In millions, except where otherwise stated)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
889
|
|
|
$
|
974
|
|
|
$
|
1,053
|
|
|
Operating income
(1)
|
|
76
|
|
|
|
63
|
|
|
|
43
|
|
|
EBITDA
(2)
|
|
129
|
|
|
|
116
|
|
|
|
95
|
|
|
(In thousands of metric tons)
|
|
|
|
|
|
|
|
|
|
|||
Shipments
|
|
1,375
|
|
|
|
1,383
|
|
|
|
1,583
|
|
|
Downtime
|
|
112
|
|
|
|
91
|
|
|
|
51
|
|
|
|
December 31,
|
|||||||||||
(In thousands of metric tons)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Finished goods inventory
|
|
90
|
|
|
|
93
|
|
|
|
81
|
|
|
(1)
|
Net income including noncontrolling interests
is equal to
operating income
in this segment.
|
(2)
|
EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “
Results of Operations – Consolidated Results – Selected Annual Financial Information
” above.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net income including noncontrolling interests
|
$
|
76
|
|
|
$
|
63
|
|
|
$
|
43
|
|
|
Depreciation and amortization
|
|
53
|
|
|
|
53
|
|
|
|
52
|
|
|
EBITDA
|
|
129
|
|
|
|
116
|
|
|
|
95
|
|
|
•
|
lower maintenance costs and fewer operational disruptions ($14 million);
|
•
|
lower steam costs ($10 million), mainly due to natural gas prices;
|
•
|
the abnormally cold winter of 2014, including higher steam costs and wood prices in the prior year ($8 million);
|
•
|
higher contribution from the cogeneration facility at Saint-Félicien ($8 million);
|
•
|
lower chemical and fiber costs ($7 million), mainly due to lower commodity prices;
|
•
|
lower wood chip prices ($5 million); and
|
•
|
a favorable property tax adjustment ($4 million).
|
•
|
lower power, steam and wood chip costs and other miscellaneous improvements ($6 million);
|
•
|
lower defined benefit pension and OPEB expenses ($4 million), mainly as a result of amendments to our U.S. OPEB plans;
|
•
|
better overall labor costs as a result of restructuring initiatives ($3 million); and
|
•
|
lower maintenance at our RBK mills ($2 million);
|
•
|
the abnormally cold winter ($8 million), including higher steam costs and wood prices in the U.S. Southeast;
|
•
|
operational disruptions ($8 million); and
|
•
|
lower contribution from the cogeneration facility at Saint-Félicien because of mechanical failures ($4 million).
|
|
Years Ended December 31,
|
|||||||||||
(In millions, except where otherwise stated)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Operating loss
(1)
|
|
(1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
EBITDA
(2)
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
(In thousands of short tons)
|
|
|
|
|
|
|
|
|
|
|||
Shipments
|
|
7
|
|
|
|
—
|
|
|
|
—
|
|
|
Downtime
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
December 31,
|
|||||||||||
(In thousands of short tons)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Finished goods inventory
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
Net loss including noncontrolling interests
is equal to
operating loss
in this segment.
|
(2)
|
EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “
Results of Operations – Consolidated Results – Selected Annual Financial Information
” above.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net loss including noncontrolling interests
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Depreciation and amortization
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
EBITDA
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Years Ended December 31,
|
|||||||||||
(In millions, except where otherwise stated)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
536
|
|
|
$
|
610
|
|
|
$
|
569
|
|
|
Operating income
(1)
|
|
2
|
|
|
|
69
|
|
|
|
41
|
|
|
EBITDA
(2)
|
|
39
|
|
|
|
102
|
|
|
|
77
|
|
|
(In million board feet)
|
|
|
|
|
|
|
|
|
|
|||
Shipments
|
|
1,678
|
|
|
|
1,585
|
|
|
|
1,480
|
|
|
Downtime
|
|
176
|
|
|
|
170
|
|
|
|
482
|
|
|
|
December 31,
|
|||||||||||
(In million board feet)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Finished goods inventory
|
|
130
|
|
|
|
117
|
|
|
|
123
|
|
|
(1)
|
Net income including noncontrolling interests
is equal to
operating income
in this segment.
|
(2)
|
EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “
Results of Operations – Consolidated Results – Selected Annual Financial Information
” above.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net income including noncontrolling interests
|
$
|
2
|
|
|
$
|
69
|
|
|
$
|
41
|
|
|
Depreciation and amortization
|
|
37
|
|
|
|
33
|
|
|
|
36
|
|
|
EBITDA
|
|
39
|
|
|
|
102
|
|
|
|
77
|
|
|
•
|
higher log costs in the province of Quebec due to the comprehensive modification of the forest tenure system ($17 million); and
|
•
|
lower internal wood chip selling prices ($10 million);
|
•
|
the recognition of additional tax credits in connection with infrastructure investments ($10 million); and
|
•
|
better fiber usage following process improvements at certain sawmills as well as increased productivity at the new sawline in Comtois ($3 million).
|
|
Years Ended December 31,
|
|||||||||||
(In millions, except where otherwise stated)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
1,105
|
|
|
$
|
1,402
|
|
|
$
|
1,473
|
|
|
Operating (loss) income
(1)
|
|
(23
|
)
|
|
|
20
|
|
|
|
39
|
|
|
EBITDA
(2)
|
|
41
|
|
|
|
89
|
|
|
|
112
|
|
|
(In thousands of metric tons)
|
|
|
|
|
|
|
|
|
|
|||
Shipments
|
|
2,150
|
|
|
|
2,371
|
|
|
|
2,392
|
|
|
Downtime
|
|
78
|
|
|
|
196
|
|
|
|
141
|
|
|
|
December 31,
|
|||||||||||
(In thousands of metric tons)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Finished goods inventory
|
|
91
|
|
|
|
115
|
|
|
|
99
|
|
|
(1)
|
Net (loss) income including noncontrolling interests
is equal to
operating (loss) income
in this segment.
|
(2)
|
EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “
Results of Operations – Consolidated Results – Selected Annual Financial Information
” above.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net (loss) income including noncontrolling interests
|
$
|
(23
|
)
|
|
$
|
20
|
|
|
$
|
39
|
|
|
Depreciation and amortization
|
|
64
|
|
|
|
69
|
|
|
|
73
|
|
|
EBITDA
|
|
41
|
|
|
|
89
|
|
|
|
112
|
|
|
•
|
the abnormally cold winter of 2014 ($21 million), particularly the cost of electricity at the Ontario mills;
|
•
|
the effect of asset optimization initiatives ($21 million), including the sale of most of our recycling assets in 2014;
|
•
|
lower maintenance costs and fewer operational disruptions ($5 million);
|
•
|
lower fiber costs ($5 million), mainly due to lower recycled fiber prices;
|
•
|
lower steam costs ($4 million), mainly due to lower natural gas prices;
|
•
|
favorable property tax adjustments ($4 million); and
|
•
|
lower wood chip prices ($3 million);
|
•
|
higher power costs ($7 million), mostly due to higher power prices in Ontario; and
|
•
|
the recognition of an energy saving incentive in the U.S. Southeast in 2014 ($6 million).
|
•
|
the closure of the Iroquois Falls mill in the fourth quarter of 2014;
|
•
|
the closure of a paper machine in Baie-Comeau, Quebec, in the fourth quarter of 2014; and
|
•
|
the closure of a paper machine in Clermont, Quebec, in the first quarter of 2015.
|
•
|
the unfavorable effect of the abnormally cold winter ($21 million), particularly the cost of electricity at the Ontario mills; and
|
•
|
higher maintenance costs ($7 million);
|
•
|
full year operation of the Thunder Bay cogeneration facility, partly offset by additional maintenance ($8 million);
|
•
|
the recognition of an energy savings incentive in the U.S. Southeast ($6 million); and
|
•
|
lower internal wood chip prices ($5 million).
|
|
Years Ended December 31,
|
|||||||||||
(In millions, except where otherwise stated)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
1,104
|
|
|
$
|
1,272
|
|
|
$
|
1,366
|
|
|
Operating income (loss)
(1)
|
|
29
|
|
|
|
(19
|
)
|
|
|
39
|
|
|
EBITDA
(2)
|
|
100
|
|
|
|
63
|
|
|
|
116
|
|
|
(In thousands of short tons)
|
|
|
|
|
|
|
|
|
|
|||
Shipments
|
|
1,580
|
|
|
|
1,778
|
|
|
|
1,837
|
|
|
Downtime
|
|
66
|
|
|
|
126
|
|
|
|
188
|
|
|
|
December 31,
|
|||||||||||
(In thousands of short tons)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Finished goods inventory
|
|
88
|
|
|
|
83
|
|
|
|
96
|
|
|
(1)
|
Net income (loss) including noncontrolling interests
is equal to
operating income (loss)
in this segment.
|
(2)
|
EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “
Results of Operations – Consolidated Results – Selected Annual Financial Information
” above.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net income (loss) including noncontrolling interests
|
$
|
29
|
|
|
$
|
(19
|
)
|
|
$
|
39
|
|
|
Depreciation and amortization
|
|
71
|
|
|
|
82
|
|
|
|
77
|
|
|
EBITDA
|
|
100
|
|
|
|
63
|
|
|
|
116
|
|
|
•
|
the effect of asset optimization initiatives ($16 million);
|
•
|
the abnormally cold winter of 2014 ($11 million), which included a significant increase in steam costs, particularly at our U.S. Southeast mills;
|
•
|
lower chemical costs ($8 million), mostly related to lower commodity prices; and
|
•
|
lower maintenance costs and fewer operational disruptions ($6 million);
|
•
|
the closure of a previously idled paper machine at Catawba in the second quarter of 2014;
|
•
|
the closure of a paper machine at Iroquois Falls in the second quarter of 2014;
|
•
|
the closure of a previously idled paper machine at Fort Frances in the second quarter of 2014; and
|
•
|
the closure of the Laurentide mill in the fourth quarter of 2014;
|
•
|
the restart of a paper machine in Calhoun in the first quarter of 2014.
|
•
|
the abnormally cold winter in the first quarter ($11 million), including a significant increase in steam costs, particularly at our U.S. Southeast mills;
|
•
|
higher fuel and power costs mainly due to higher natural gas pricing and unfavorable usage ($11 million);
|
•
|
costs associated with mechanical failures ($5 million);
|
•
|
higher bark costs at the Dolbeau cogeneration facility ($3 million); and
|
•
|
the timing of business interruption insurance proceeds received in 2013 ($3 million);
|
•
|
the effect of asset optimization initiatives ($17 million);
|
•
|
lower defined benefit pension and OPEB expenses ($10 million), mainly as a result of amendments to our U.S. OPEB plans; and
|
•
|
lower wood chip prices ($3 million).
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Cost of sales, excluding depreciation, amortization and distribution costs
|
$
|
(78
|
)
|
|
$
|
(18
|
)
|
|
$
|
(48
|
)
|
|
Depreciation and amortization
|
|
(11
|
)
|
|
|
(6
|
)
|
|
|
(5
|
)
|
|
Selling, general and administrative expenses
|
|
(32
|
)
|
|
|
(7
|
)
|
|
|
(24
|
)
|
|
Closure costs, impairment and other related charges
|
|
(181
|
)
|
|
|
(278
|
)
|
|
|
(89
|
)
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
2
|
|
|
|
2
|
|
|
Operating loss
|
$
|
(302
|
)
|
|
$
|
(307
|
)
|
|
$
|
(164
|
)
|
|
Interest expense
|
|
(41
|
)
|
|
|
(47
|
)
|
|
|
(51
|
)
|
|
Other income (expense), net
|
|
4
|
|
|
|
(83
|
)
|
|
|
(62
|
)
|
|
Income tax benefit (provision)
|
|
1
|
|
|
|
30
|
|
|
|
(524
|
)
|
|
Net loss including noncontrolling interests
|
$
|
(338
|
)
|
|
$
|
(407
|
)
|
|
$
|
(801
|
)
|
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net loss including noncontrolling interests
|
$
|
(338
|
)
|
|
$
|
(407
|
)
|
|
$
|
(801
|
)
|
|
Interest expense
|
|
41
|
|
|
|
47
|
|
|
|
51
|
|
|
Income tax (benefit) provision
|
|
(1
|
)
|
|
|
(30
|
)
|
|
|
524
|
|
|
Depreciation and amortization
|
|
11
|
|
|
|
6
|
|
|
|
5
|
|
|
EBITDA
|
$
|
(287
|
)
|
|
$
|
(384
|
)
|
|
$
|
(221
|
)
|
|
Foreign exchange translation loss
|
|
4
|
|
|
|
32
|
|
|
|
24
|
|
|
Closure costs, impairment and other related charges
|
|
181
|
|
|
|
278
|
|
|
|
89
|
|
|
Inventory write-downs related to closures
|
|
2
|
|
|
|
17
|
|
|
|
11
|
|
|
Start-up costs
|
|
5
|
|
|
|
4
|
|
|
|
32
|
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Non-operating pension and OPEB costs (credits)
|
|
66
|
|
|
|
(10
|
)
|
|
|
5
|
|
|
Write-down of equity method investment
|
|
—
|
|
|
|
61
|
|
|
|
—
|
|
|
Net loss on extinguishment of debt
|
|
—
|
|
|
|
—
|
|
|
|
59
|
|
|
Acquisition-related costs
|
|
4
|
|
|
|
—
|
|
|
|
6
|
|
|
Other income, net
|
|
(8
|
)
|
|
|
(10
|
)
|
|
|
(21
|
)
|
|
Adjusted EBITDA
|
$
|
(33
|
)
|
|
$
|
(14
|
)
|
|
$
|
(18
|
)
|
|
•
|
defined benefit pension and OPEB costs ($60 million), mainly non-operating costs;
|
•
|
asset preservation costs for the permanently closed Fort Frances, Laurentide and Iroquois Falls mills ($9 million); and
|
•
|
start-up costs ($5 million), primarily related to the ramp-up of our Atikokan sawmill.
|
•
|
write-downs of mill stores and other supplies ($17 million) as a result of the permanent closure of our Laurentide and Iroquois Falls paper mills and the permanent closure of a paper machine in Catawba; and
|
•
|
asset preservation costs ($10 million), mainly related to the permanently closed Fort Frances mill;
|
•
|
$97 million of accelerated depreciation, $11 million for severance and other termination benefits and $9 million for other closure costs, including environmental remediation obligations, in connection with the permanent closure of the Laurentide mill;
|
•
|
$60 million of accelerated depreciation, $9 million for severance and other termination benefits and $8 million for other closure costs, including environmental remediation obligations, in connection with the permanent closure of our Iroquois Falls mill;
|
•
|
accelerated depreciation following our decision in the second quarter to permanently close the idled paper machine in Catawba ($45 million);
|
•
|
idling and cleaning costs as well as severance charges at our Fort Frances mill ($12 million); and
|
•
|
long-lived asset impairment charges in connection with the sale of most of our recycling assets ($6 million).
|
•
|
lower start-up costs ($28 million), primarily due to the restart of the Gatineau mill in June of 2013;
|
•
|
lower defined benefit pension and OPEB expenses ($16 million), mostly non-operating costs; and
|
•
|
the recognition of tax, research and development and insurance credits ($4 million);
|
•
|
higher asset preservation costs ($10 million); and
|
•
|
higher stores inventory write-downs ($6 million) in connection with the closure of a machine at our Catawba mill and the permanent closure of the Laurentide and Iroquois Falls mills.
|
•
|
accelerated depreciation and severance costs associated with the idling of a newsprint machine at our Calhoun mill ($50 million);
|
•
|
an extended market-related outage at the remaining paper machine in Fort Frances ($14 million); and
|
•
|
the impairment of our U.S. recycling assets ($11 million).
|
•
|
incur, assume or guarantee additional indebtedness;
|
•
|
issue redeemable stock and preferred stock;
|
•
|
pay dividends or make distributions or redeem or repurchase capital stock;
|
•
|
prepay, redeem or repurchase certain debt;
|
•
|
make loans and investments;
|
•
|
incur liens;
|
•
|
issue dividends, make loans or transfer assets from our subsidiaries;
|
•
|
sell or otherwise dispose of assets, including capital stock of subsidiaries;
|
•
|
consolidate or merge with or into, or sell substantially all of our assets to, another person;
|
•
|
enter into transactions with affiliates; and
|
•
|
enter into new lines of business.
|
(1)
|
In January 2016, our liquidity rating was revised to SGL-2.
|
|
Years Ended December 31,
|
|||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net cash provided by operating activities
|
$
|
138
|
|
|
$
|
186
|
|
|
$
|
206
|
|
|
Net cash used in investing activities
|
|
(352
|
)
|
|
|
(161
|
)
|
|
|
(151
|
)
|
|
Net cash (used in) provided by financing activities
|
|
(62
|
)
|
|
|
(7
|
)
|
|
|
4
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
(3
|
)
|
|
|
(3
|
)
|
|
|
—
|
|
|
Net (decrease) increase in cash and cash equivalents
|
$
|
(279
|
)
|
|
$
|
15
|
|
|
$
|
59
|
|
|
•
|
the construction of a new sawmill in Atikokan and a wood pellet plant in Thunder Bay, as well as the refurbishment of the Ignace sawmill; and
|
•
|
the upgrade to the Calhoun pulp mill to install a continuous digester and other wood chip processing equipment.
|
•
|
make approximately $250 million in capital expenditures, net of support under existing business development programs, including up to $165 million on the tissue project in Calhoun and $65 million on other value-creating projects; and
|
•
|
pursue other strategic opportunities, with a particular focus on those that reduce our cost position, improve our product diversification, provide synergies or allow us to expand into future growth markets.
|
|
December 31,
|
|||||||||||
Affected Plans
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Discount rate for accounting purposes
|
|
4.2
|
%
|
|
|
3.9
|
%
|
|
|
4.8
|
%
|
|
Balance sheet funded status
|
|
81.9
|
%
|
|
|
78.7
|
%
|
|
|
84.0
|
%
|
|
Discount rate for solvency purposes
|
|
2.4
|
%
|
(1)
|
|
2.6
|
%
|
|
|
3.8
|
%
|
|
Solvency ratio
|
|
71.7
|
%
|
(1)
|
|
71.3
|
%
|
|
|
76.8
|
%
|
|
(1)
|
Preliminary, subject to final actuarial report.
|
(In millions)
|
Total
|
|
|
2016
|
|
|
2017-2018
|
|
|
2019-2020
|
|
|
Thereafter
|
|
||||||
Long-term debt
(1)
|
$
|
866
|
|
|
$
|
36
|
|
|
$
|
71
|
|
|
$
|
71
|
|
|
$
|
688
|
|
|
Non-cancelable operating lease obligations
(2)
|
|
37
|
|
|
|
6
|
|
|
|
9
|
|
|
|
8
|
|
|
|
14
|
|
|
Purchase obligations
(2)
|
|
389
|
|
|
|
119
|
|
|
|
155
|
|
|
|
91
|
|
|
|
24
|
|
|
|
$
|
1,292
|
|
|
$
|
161
|
|
|
$
|
235
|
|
|
$
|
170
|
|
|
$
|
726
|
|
|
(1)
|
Long-term debt commitments represent primarily interest payments on the 2023 notes over the periods indicated and payment of the remaining principal balance at maturity, assuming no further redemptions.
|
(2)
|
Information on our operating leases and purchase obligations can be found in
Note 18, “Operating Leases and Purchase Obligations
,” to our Consolidated Financial Statements.
|
•
|
discount rate – used to determine the net present value of our pension and OPEB obligations and to determine the interest cost component of our net periodic pension and OPEB costs;
|
•
|
return on assets – used to estimate the growth in the value of invested assets that are available to satisfy pension benefit obligations and to determine the expected return on plan assets component of our net periodic pension benefit costs;
|
•
|
life expectancy rate – used to estimate the impact of life expectancy on pension and OPEB obligations;
|
•
|
rate of compensation increase – used to calculate the impact future pay increases will have on pension benefit obligations; and
|
•
|
health care cost trend rate – used to calculate the impact of future health care costs on OPEB obligations.
|
|
2015 Net Periodic Benefit Cost
|
|
Pension and OPEB Obligations as of December 31, 2015
|
||||||||||||||
(In millions)
|
25 Basis Point Increase
|
25 Basis Point Decrease
|
|
25 Basis Point Increase
|
25 Basis Point Decrease
|
||||||||||||
Assumption:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Discount rate
|
$
|
(8
|
)
|
|
$
|
10
|
|
|
|
$
|
(132
|
)
|
|
$
|
145
|
|
|
Return on assets
|
|
(10
|
)
|
|
|
10
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Rate of compensation increase
|
|
1
|
|
|
|
(1
|
)
|
|
|
|
8
|
|
|
|
(8
|
)
|
|
Health care cost trend rate
|
|
—
|
|
|
|
—
|
|
|
|
|
2
|
|
|
|
(2
|
)
|
|
•
|
Deferred income tax assets of $917 million, comprised of $728 million for federal and state operating loss carryforwards expiring between 2016 and 2035, and $189 million for other temporary differences, mostly related to pension and OPEB plans.
|
•
|
Deferred income tax liabilities of $96 million, mostly related to accelerated depreciation on fixed assets.
|
•
|
A valuation allowance of $821 million against the net deferred income tax assets, which are not more likely than not to be realized in the future.
|
•
|
Deferred income tax assets of $1,008 million, comprised of $177 million related to a pool of scientific research and experimental development costs with no expiry, $21 million for federal and provincial operating loss carryforwards expiring between 2025 and 2035, $91 million for tax credit carryforwards expiring between 2021 and 2036, as well as $719 million for other temporary differences, mostly related to fixed asset undepreciated capital costs with no expiry, and pension and OPEB plans.
|
•
|
Deferred income tax liabilities of $15 million for various temporary differences.
|
•
|
A valuation allowance of $13 million related to items of a capital nature.
|
•
|
Deferred income tax assets of $31 million, mostly comprised of other foreign subsidiaries operating loss carryforwards expiring between 2019 and 2025.
|
•
|
A valuation allowance of $31 million against the net deferred income tax assets of other foreign subsidiaries, which are not more likely than not to be realized in the future.
|
PRODUCT
|
Unit
|
Projected change in annualized EBITDA ($ millions) based on $25 change in price per unit
|
|||
Market pulp
|
$ / metric ton
|
40
|
|
|
|
Wood products
|
$ / thousand board feet
|
45
|
|
|
|
Newsprint
|
$ / metric ton
|
50
|
|
|
|
Specialty papers
|
$ / short ton
|
39
|
|
|
|
Page
|
|
Years Ended December 31,
|
|||||||||||
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Sales
|
$
|
3,645
|
|
|
$
|
4,258
|
|
|
$
|
4,461
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|||
Cost of sales, excluding depreciation, amortization and distribution costs
|
|
2,826
|
|
|
|
3,240
|
|
|
|
3,446
|
|
|
Depreciation and amortization
|
|
237
|
|
|
|
243
|
|
|
|
243
|
|
|
Distribution costs
|
|
460
|
|
|
|
518
|
|
|
|
521
|
|
|
Selling, general and administrative expenses
|
|
160
|
|
|
|
155
|
|
|
|
166
|
|
|
Closure costs, impairment and other related charges
|
|
181
|
|
|
|
278
|
|
|
|
89
|
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Operating loss
|
|
(219
|
)
|
|
|
(174
|
)
|
|
|
(2
|
)
|
|
Interest expense
|
|
(41
|
)
|
|
|
(47
|
)
|
|
|
(51
|
)
|
|
Other income (expense), net
|
|
4
|
|
|
|
(83
|
)
|
|
|
(62
|
)
|
|
Loss before income taxes
|
|
(256
|
)
|
|
|
(304
|
)
|
|
|
(115
|
)
|
|
Income tax benefit (provision)
|
|
1
|
|
|
|
30
|
|
|
|
(524
|
)
|
|
Net loss including noncontrolling interests
|
|
(255
|
)
|
|
|
(274
|
)
|
|
|
(639
|
)
|
|
Net income attributable to noncontrolling interests
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
—
|
|
|
Net loss attributable to Resolute Forest Products Inc.
|
$
|
(257
|
)
|
|
$
|
(277
|
)
|
|
$
|
(639
|
)
|
|
Net loss per share attributable to Resolute Forest Products Inc. common shareholders:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
$
|
(2.78
|
)
|
|
$
|
(2.93
|
)
|
|
$
|
(6.75
|
)
|
|
Diluted
|
|
(2.78
|
)
|
|
|
(2.93
|
)
|
|
|
(6.75
|
)
|
|
Weighted-average number of Resolute Forest Products Inc. common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
92.4
|
|
|
|
94.6
|
|
|
|
94.7
|
|
|
Diluted
|
|
92.4
|
|
|
|
94.6
|
|
|
|
94.7
|
|
|
|
|
Years Ended December 31,
|
|
|||||||||
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Net loss including noncontrolling interests
|
$
|
(255
|
)
|
|
$
|
(274
|
)
|
|
$
|
(639
|
)
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|||
Unamortized prior service credits:
|
|
|
|
|
|
|
|
|
|
|||
Change in unamortized prior service credits
|
|
(16
|
)
|
|
|
75
|
|
|
|
(3
|
)
|
|
Income tax benefit
|
|
6
|
|
|
|
1
|
|
|
|
—
|
|
|
Change in unamortized prior service credits, net of tax
|
|
(10
|
)
|
|
|
76
|
|
|
|
(3
|
)
|
|
Unamortized actuarial losses:
|
|
|
|
|
|
|
|
|
|
|||
Change in unamortized actuarial losses
|
|
208
|
|
|
|
(638
|
)
|
|
|
471
|
|
|
Income tax (provision) benefit
|
|
(63
|
)
|
|
|
116
|
|
|
|
(121
|
)
|
|
Change in unamortized actuarial losses, net of tax
|
|
145
|
|
|
|
(522
|
)
|
|
|
350
|
|
|
Foreign currency translation
|
|
(4
|
)
|
|
|
(1
|
)
|
|
|
(4
|
)
|
|
Other comprehensive income (loss), net of tax
|
|
131
|
|
|
|
(447
|
)
|
|
|
343
|
|
|
Comprehensive loss including noncontrolling interests
|
|
(124
|
)
|
|
|
(721
|
)
|
|
|
(296
|
)
|
|
Comprehensive income attributable to noncontrolling interests
|
|
(2
|
)
|
|
|
(3
|
)
|
|
|
—
|
|
|
Comprehensive loss attributable to Resolute Forest Products Inc.
|
$
|
(126
|
)
|
|
$
|
(724
|
)
|
|
$
|
(296
|
)
|
|
|
December 31,
2015 |
December 31,
2014 |
||||||
Assets
|
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
58
|
|
|
$
|
337
|
|
|
Accounts receivable, net:
|
|
|
|
|
|
|
||
Trade
|
|
377
|
|
|
|
449
|
|
|
Other
|
|
82
|
|
|
|
90
|
|
|
Inventories, net
|
|
541
|
|
|
|
542
|
|
|
Other current assets
|
|
53
|
|
|
|
46
|
|
|
Total current assets
|
|
1,111
|
|
|
|
1,464
|
|
|
Fixed assets, net
|
|
1,810
|
|
|
|
1,985
|
|
|
Amortizable intangible assets, net
|
|
105
|
|
|
|
62
|
|
|
Goodwill
|
|
59
|
|
|
|
—
|
|
|
Deferred income tax assets
|
|
982
|
|
|
|
1,289
|
|
|
Other assets
|
|
153
|
|
|
|
114
|
|
|
Total assets
|
$
|
4,220
|
|
|
$
|
4,914
|
|
|
|
|
|
|
|
|
|
||
Liabilities and equity
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Accounts payable and accrued liabilities
|
$
|
436
|
|
|
$
|
518
|
|
|
Current portion of long-term debt
|
|
1
|
|
|
|
1
|
|
|
Total current liabilities
|
|
437
|
|
|
|
519
|
|
|
Long-term debt, net of current portion
|
|
590
|
|
|
|
589
|
|
|
Pension and other postretirement benefit obligations
|
|
1,186
|
|
|
|
1,616
|
|
|
Deferred income tax liabilities
|
|
2
|
|
|
|
3
|
|
|
Other liabilities
|
|
60
|
|
|
|
70
|
|
|
Total liabilities
|
|
2,275
|
|
|
|
2,797
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
||
Equity:
|
|
|
|
|
|
|
||
Resolute Forest Products Inc. shareholders’ equity:
|
|
|
|
|
|
|
||
Common stock, $0.001 par value. 117.5 shares issued and 89.5 shares outstanding as of December 31, 2015; 117.3 shares issued and 94.8 shares outstanding as of December 31, 2014
|
|
—
|
|
|
|
—
|
|
|
Additional paid-in capital
|
|
3,765
|
|
|
|
3,754
|
|
|
Deficit
|
|
(1,126
|
)
|
|
|
(869
|
)
|
|
Accumulated other comprehensive loss
|
|
(587
|
)
|
|
|
(718
|
)
|
|
Treasury stock at cost, 28.0 shares and 22.5 shares as of December 31, 2015 and December 31, 2014, respectively
|
|
(120
|
)
|
|
|
(61
|
)
|
|
Total Resolute Forest Products Inc. shareholders’ equity
|
|
1,932
|
|
|
|
2,106
|
|
|
Noncontrolling interests
|
|
13
|
|
|
|
11
|
|
|
Total equity
|
|
1,945
|
|
|
|
2,117
|
|
|
Total liabilities and equity
|
$
|
4,220
|
|
|
$
|
4,914
|
|
|
|
Resolute Forest Products Inc. Shareholders’ Equity
|
|
|
|
|
|
|
|||||||||||||||||||||
|
Common
Stock |
Additional
Paid-in Capital |
Retained Earnings (Deficit)
|
Accumulated Other Comprehensive Loss
|
Treasury
Stock |
Non-
controlling Interests |
Total Equity
|
|||||||||||||||||||||
Balance as of December 31, 2012
|
$
|
—
|
|
|
$
|
3,730
|
|
|
$
|
47
|
|
|
$
|
(614
|
)
|
|
$
|
(61
|
)
|
|
$
|
23
|
|
|
$
|
3,125
|
|
|
Share-based compensation costs for equity-classified awards
|
|
—
|
|
|
|
7
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
|
Net loss
|
|
—
|
|
|
|
—
|
|
|
|
(639
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(639
|
)
|
|
Contribution of capital from noncontrolling interest (net of tax of $3)
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5
|
|
|
|
5
|
|
|
Acquisition of noncontrolling interest (Note 5)
|
|
—
|
|
|
|
14
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(14
|
)
|
|
|
—
|
|
|
Transfer of common stock from the share reserve to the Company (0.3 shares in treasury) (Note 16)
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Dividend paid to noncontrolling interest
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Other comprehensive income, net of tax
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
343
|
|
|
|
—
|
|
|
|
—
|
|
|
|
343
|
|
|
Balance as of December 31, 2013
|
|
—
|
|
|
|
3,751
|
|
|
|
(592
|
)
|
|
|
(271
|
)
|
|
|
(61
|
)
|
|
|
12
|
|
|
|
2,839
|
|
|
Share-based compensation costs for equity-classified awards
|
|
—
|
|
|
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
|
Net (loss) income
|
|
—
|
|
|
|
—
|
|
|
|
(277
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
|
|
(274
|
)
|
|
Stock options exercised and stock unit awards vested (0.3 shares), net of shares forfeited for employee withholding taxes
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Dividend paid to noncontrolling interest
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
|
(4
|
)
|
|
Other comprehensive loss, net of tax
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(447
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(447
|
)
|
|
Balance as of December 31, 2014
|
|
—
|
|
|
|
3,754
|
|
|
|
(869
|
)
|
|
|
(718
|
)
|
|
|
(61
|
)
|
|
|
11
|
|
|
|
2,117
|
|
|
Share-based compensation costs for equity-classified awards
|
|
—
|
|
|
|
11
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
11
|
|
|
Net (loss) income
|
|
—
|
|
|
|
—
|
|
|
|
(257
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
2
|
|
|
|
(255
|
)
|
|
Purchases of treasury stock (5.5 shares) (Note 16)
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(59
|
)
|
|
|
—
|
|
|
|
(59
|
)
|
|
Stock options exercised and stock unit awards vested (0.2 shares), net of shares forfeited for employee withholding taxes
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Other comprehensive income, net of tax
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
131
|
|
|
|
—
|
|
|
|
—
|
|
|
|
131
|
|
|
Balance as of December 31, 2015
|
$
|
—
|
|
|
$
|
3,765
|
|
|
$
|
(1,126
|
)
|
|
$
|
(587
|
)
|
|
$
|
(120
|
)
|
|
$
|
13
|
|
|
$
|
1,945
|
|
|
|
Years Ended December 31,
|
|||||||||||
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Net loss including noncontrolling interests
|
$
|
(255
|
)
|
|
$
|
(274
|
)
|
|
$
|
(639
|
)
|
|
Adjustments to reconcile net loss including noncontrolling interests to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Share-based compensation
|
|
12
|
|
|
|
6
|
|
|
|
7
|
|
|
Depreciation and amortization
|
|
237
|
|
|
|
243
|
|
|
|
243
|
|
|
Closure costs, impairment and other related charges
|
|
176
|
|
|
|
263
|
|
|
|
80
|
|
|
Inventory write-downs related to closures
|
|
2
|
|
|
|
17
|
|
|
|
11
|
|
|
Deferred income taxes
|
|
3
|
|
|
|
(36
|
)
|
|
|
523
|
|
|
Net pension contributions and other postretirement benefit payments
|
|
(62
|
)
|
|
|
(157
|
)
|
|
|
(117
|
)
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Loss on translation of foreign currency denominated deferred income taxes
|
|
199
|
|
|
|
107
|
|
|
|
93
|
|
|
Gain on translation of foreign currency denominated pension and other postretirement benefit obligations
|
|
(184
|
)
|
|
|
(82
|
)
|
|
|
(88
|
)
|
|
Gain on forgiveness of note payable
|
|
—
|
|
|
|
—
|
|
|
|
(12
|
)
|
|
Net loss on extinguishment of debt
|
|
—
|
|
|
|
—
|
|
|
|
59
|
|
|
Write-down of equity method investment
|
|
—
|
|
|
|
61
|
|
|
|
—
|
|
|
Changes in working capital:
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
|
87
|
|
|
|
106
|
|
|
|
62
|
|
|
Inventories
|
|
10
|
|
|
|
(31
|
)
|
|
|
16
|
|
|
Other current assets
|
|
(4
|
)
|
|
|
(3
|
)
|
|
|
10
|
|
|
Accounts payable and accrued liabilities
|
|
(85
|
)
|
|
|
(44
|
)
|
|
|
(37
|
)
|
|
Other, net
|
|
2
|
|
|
|
12
|
|
|
|
(3
|
)
|
|
Net cash provided by operating activities
|
|
138
|
|
|
|
186
|
|
|
|
206
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Cash invested in fixed assets
|
|
(185
|
)
|
|
|
(193
|
)
|
|
|
(161
|
)
|
|
Acquisition of Atlas Paper Holdings, Inc., including cash overdraft acquired
|
|
(159
|
)
|
|
|
—
|
|
|
|
—
|
|
|
Monetization of timber notes
|
|
—
|
|
|
|
22
|
|
|
|
—
|
|
|
Disposition of assets
|
|
—
|
|
|
|
10
|
|
|
|
4
|
|
|
Proceeds from insurance settlements
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
Increase in countervailing duties cash deposits
|
|
(4
|
)
|
|
|
—
|
|
|
|
—
|
|
|
Decrease in restricted cash
|
|
—
|
|
|
|
1
|
|
|
|
8
|
|
|
(Increase) decrease in deposit requirements for letters of credit, net
|
|
(4
|
)
|
|
|
1
|
|
|
|
(2
|
)
|
|
Other investing activities, net
|
|
—
|
|
|
|
(2
|
)
|
|
|
(4
|
)
|
|
Net cash used in investing activities
|
|
(352
|
)
|
|
|
(161
|
)
|
|
|
(151
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Issuance of long-term debt
|
|
—
|
|
|
|
—
|
|
|
|
594
|
|
|
Premium paid on extinguishment of debt
|
|
—
|
|
|
|
—
|
|
|
|
(84
|
)
|
|
Payments of debt
|
|
—
|
|
|
|
(2
|
)
|
|
|
(503
|
)
|
|
Payments of financing and credit facility fees
|
|
(3
|
)
|
|
|
(1
|
)
|
|
|
(9
|
)
|
|
Purchases of treasury stock
|
|
(59
|
)
|
|
|
—
|
|
|
|
—
|
|
|
Dividend to noncontrolling interest
|
|
—
|
|
|
|
(4
|
)
|
|
|
(2
|
)
|
|
Contribution of capital from noncontrolling interest
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
|
Net cash (used in) provided by financing activities
|
|
(62
|
)
|
|
|
(7
|
)
|
|
|
4
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
(3
|
)
|
|
|
(3
|
)
|
|
|
—
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
(279
|
)
|
|
|
15
|
|
|
|
59
|
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|||
Beginning of year
|
|
337
|
|
|
|
322
|
|
|
|
263
|
|
|
End of year
|
$
|
58
|
|
|
$
|
337
|
|
|
$
|
322
|
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid (received) during the year for:
|
|
|
|
|
|
|
|
|
|
|||
Interest, including capitalized interest of $5, $3 and $2 in 2015, 2014 and 2013, respectively
|
$
|
40
|
|
|
$
|
42
|
|
|
$
|
54
|
|
|
Income taxes, net
|
|
3
|
|
|
|
(1
|
)
|
|
|
2
|
|
|
Consolidated Subsidiary
|
Resolute Forest Products Ownership
|
Partner
|
Partner
Ownership
|
Forest Products Mauricie L.P.
|
93.2%
|
Coopérative Forestière du Haut Saint-Maurice
|
6.8%
|
Donohue Malbaie Inc.
|
51%
|
NYT Capital Inc.
|
49%
|
Level 1 -
|
Valuations based on quoted prices in active markets for identical assets and liabilities.
|
|
|
Level 2 -
|
Valuations based on observable inputs, other than Level 1 prices, such as quoted interest or currency exchange rates.
|
|
|
Level 3 -
|
Valuations based on significant unobservable inputs that are supported by little or no market activity, such as discounted cash flow methodologies based on internal cash flow forecasts.
|
|
2015
|
2014
|
||||||||||||||||||||||
(In millions)
|
Before Accounting Policy Change
|
Adjustment
|
As
Reported
|
As Previously Reported
|
Effect of Change
|
As
Adjusted
|
||||||||||||||||||
Other assets
|
$
|
160
|
|
|
$
|
(7
|
)
|
|
$
|
153
|
|
|
$
|
121
|
|
|
$
|
(7
|
)
|
|
$
|
114
|
|
|
Long-term debt, net of current portion
|
|
597
|
|
|
|
(7
|
)
|
|
|
590
|
|
|
|
596
|
|
|
|
(7
|
)
|
|
|
589
|
|
|
|
2015
|
2014
|
||||||||||||||||||||||
(In millions)
|
Before Accounting Policy Change
|
Adjustment
|
As
Reported
|
As Previously Reported
|
Effect of Change
|
As
Adjusted
|
||||||||||||||||||
Deferred income tax assets (current)
|
$
|
22
|
|
|
$
|
(22
|
)
|
|
$
|
—
|
|
|
$
|
70
|
|
|
$
|
(70
|
)
|
|
$
|
—
|
|
|
Deferred income tax assets (non-current)
|
|
960
|
|
|
|
22
|
|
|
|
982
|
|
|
|
1,219
|
|
|
|
70
|
|
|
|
1,289
|
|
|
(1)
|
Amortizable intangible assets identified relate primarily to customer relationships, which have a weighted-average amortization period of
13 years
. The fair value of the amortizable intangible assets was determined using the income approach through an excess earnings analysis discounted at a rate of
12%
.
|
(2)
|
Goodwill represents the future economic benefit arising from other assets acquired that could not be individually identified and separately recognized and is mostly attributable to Atlas Paper’s assembled workforce, expected synergies with certain of our existing assets and expected future cash flows. Goodwill was assigned to the tissue segment for the purposes of impairment testing in the future. Goodwill recognized is not deductible for tax purposes.
|
(Unaudited, in millions except per share data)
|
2015
|
|
|
2014
|
|
|
||
Sales
|
$
|
3,734
|
|
|
$
|
4,332
|
|
|
Net loss attributable to Resolute Forest Products Inc.
|
|
(261
|
)
|
|
|
(282
|
)
|
|
Basic net loss per share attributable to Resolute Forest Products Inc.
|
|
(2.82
|
)
|
|
|
(2.98
|
)
|
|
Diluted net loss per share attributable to Resolute Forest Products Inc.
|
|
(2.82
|
)
|
|
|
(2.98
|
)
|
|
(In millions)
|
Impairment of Assets
|
Accelerated Depreciation
|
Severance and Other Costs
|
Total
|
||||||||||||
Paper mill in Catawba, South Carolina
(1)
|
$
|
176
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
176
|
|
|
Permanent closures:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Paper mill in Iroquois Falls, Ontario
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
|
|
3
|
|
|
Paper machine in Clermont, Quebec
|
|
—
|
|
|
|
2
|
|
|
|
—
|
|
|
|
2
|
|
|
|
$
|
176
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
181
|
|
|
(1)
|
As a result of declining market conditions, we recorded long-lived asset impairment charges of
$176 million
for the year ended December 31, 2015, related to our Catawba paper assets, to reduce the carrying value of the assets to fair value. Management estimated the fair value using the income approach. Projected discounted cash flows utilized under the income approach included estimates regarding future revenues and expenses attributable to the Catawba paper activities, projected capital expenditures and a discount rate of
12%
. This fair value measurement is considered a Level 3 measurement due to the significance of its unobservable inputs.
|
(In millions)
|
Impairment of Assets
|
Accelerated Depreciation
|
Pension Plan Curtailments
|
Severance and Other Costs
|
Total
|
|||||||||||||||
Permanent closures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Laurentide, Quebec paper mill
|
$
|
—
|
|
|
$
|
97
|
|
|
$
|
(2
|
)
|
|
$
|
20
|
|
|
$
|
115
|
|
|
Paper mill in Iroquois Falls
|
|
—
|
|
|
|
60
|
|
|
|
6
|
|
|
|
17
|
|
|
|
83
|
|
|
Paper machine in Catawba
|
|
—
|
|
|
|
45
|
|
|
|
—
|
|
|
|
1
|
|
|
|
46
|
|
|
Pulp and paper mill in Fort Frances, Ontario
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
|
|
12
|
|
|
Restructuring initiative:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Recycling operations
(1)
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
|
7
|
|
|
Other
|
|
8
|
|
|
|
6
|
|
|
|
—
|
|
|
|
1
|
|
|
|
15
|
|
|
|
$
|
14
|
|
|
$
|
208
|
|
|
$
|
4
|
|
|
$
|
52
|
|
|
$
|
278
|
|
|
(1)
|
We recorded long-lived asset impairment charges of
$6 million
for the year ended December 31, 2014, related to our recycling assets, to reduce the carrying value of the assets to fair value less costs to sell. We disposed of most of these assets in 2014.
|
(In millions)
|
Impairment of Assets
(2)
|
Accelerated Depreciation
|
Pension Plan Curtailments
|
Severance and Other Costs
|
Total
|
|||||||||||||||
Indefinite idlings and extended market-related outage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Paper machine in Calhoun, Tennessee
(1)
|
$
|
—
|
|
|
$
|
44
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
50
|
|
|
Pulp mill and paper machines in Fort Frances
|
|
—
|
|
|
|
—
|
|
|
|
2
|
|
|
|
15
|
|
|
|
17
|
|
|
Permanent closure:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Paper machine in Iroquois Falls
|
|
—
|
|
|
|
2
|
|
|
|
—
|
|
|
|
1
|
|
|
|
3
|
|
|
Other
|
|
11
|
|
|
|
4
|
|
|
|
1
|
|
|
|
3
|
|
|
|
19
|
|
|
|
$
|
11
|
|
|
$
|
50
|
|
|
$
|
3
|
|
|
$
|
25
|
|
|
$
|
89
|
|
|
(1)
|
Following our acquisition of the noncontrolling interest in Calhoun Newsprint Company (“CNC”), we indefinitely idled a paper machine at the Calhoun mill on March 12, 2013, resulting in accelerated depreciation charges to reduce the carrying value of the assets to reflect their revised estimated remaining useful lives. In 2014, we restarted the paper machine to produce specialty paper. For additional information regarding our acquisition of the noncontrolling interest in CNC, see
Note 5, “Other Income (Expense), Net
.”
|
(2)
|
Due to declining market conditions, we recorded long-lived asset impairment charges related to our recycling assets to reduce the carrying value of the assets to their estimated fair value, which was determined based on estimated market prices for similar assets.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Foreign exchange loss
|
$
|
(4
|
)
|
|
$
|
(32
|
)
|
|
$
|
(24
|
)
|
|
Write-down of equity method investment
(1)
|
|
—
|
|
|
|
(61
|
)
|
|
|
—
|
|
|
Net loss on extinguishment of debt (Note 12)
|
|
—
|
|
|
|
—
|
|
|
|
(59
|
)
|
|
Gain on forgiveness of note payable
(2)
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
|
Gain on liquidation settlement
(3)
|
|
—
|
|
|
|
—
|
|
|
|
12
|
|
|
Miscellaneous income (expense)
|
|
8
|
|
|
|
10
|
|
|
|
(3
|
)
|
|
|
$
|
4
|
|
|
$
|
(83
|
)
|
|
$
|
(62
|
)
|
|
(1)
|
As a result of the continued deterioration of actual and projected cash flows in Ponderay Newsprint Company, a partnership in which we have a
40%
interest, we recorded an other-than-temporary write-down of
$61 million
in 2014. The carrying value of the investment was reduced to a fair value of
nil
, which was determined using the discounted cash flow method.
|
(2)
|
On March 11, 2013, we acquired the noncontrolling interest in CNC, which was previously owned
51%
by us and included in our Consolidated Financial Statements on a fully consolidated basis. As a result, CNC became a wholly-owned subsidiary of ours. In connection with this transaction, we recognized a gain on the forgiveness of a
$12 million
note issued by CNC. The acquisition of the noncontrolling interest in CNC was accounted for as an equity transaction.
|
(3)
|
On February 2, 2010, Bridgewater Paper Company Limited (“BPCL”), a subsidiary of ours, filed for administration in the United Kingdom pursuant to the United Kingdom
Insolvency Act 1986
, as amended. As a result, we became a creditor of BPCL and lost control over their operations. In connection with our claims, we received a liquidation settlement of
$12 million
in 2013.
|
(In millions)
|
Unamortized Prior Service Credits
|
Unamortized Actuarial Losses
|
Foreign Currency Translation
|
Total
|
||||||||||||
Balance as of December 31, 2014
|
$
|
94
|
|
|
$
|
(812
|
)
|
|
$
|
—
|
|
|
$
|
(718
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
|
—
|
|
|
|
79
|
|
|
|
(4
|
)
|
|
|
75
|
|
|
Amounts reclassified from accumulated other comprehensive loss
(1)(2)
|
|
(10
|
)
|
|
|
66
|
|
|
|
—
|
|
|
|
56
|
|
|
Net current period other comprehensive (loss) income
|
|
(10
|
)
|
|
|
145
|
|
|
|
(4
|
)
|
|
|
131
|
|
|
Balance as of December 31, 2015
|
$
|
84
|
|
|
$
|
(667
|
)
|
|
$
|
(4
|
)
|
|
$
|
(587
|
)
|
|
(1)
|
In 2015, we recorded a
$9 million
(net of tax of
$5 million
) settlement charge to unamortized actuarial losses related to annuity purchases for certain inactive U.S. employees. For additional information, see
Note 13, “Pension and Other Postretirement Benefit Plans
” to our Consolidated Financial Statements.
|
(2)
|
See the table below for details about these reclassifications.
|
(In millions)
|
Amounts Reclassified From Accumulated Other Comprehensive Loss
|
Affected Line in the Consolidated Statements of Operations
|
|||
Unamortized Prior Service Credits
|
|
|
|
|
|
Amortization of prior service credits
|
$
|
(16
|
)
|
|
Cost of sales, excluding depreciation, amortization and distribution costs
(1)
|
|
|
6
|
|
|
Income tax benefit (provision)
|
|
$
|
(10
|
)
|
|
Net of tax
|
Unamortized Actuarial Losses
|
|
|
|
|
|
Amortization of actuarial losses
|
$
|
79
|
|
|
Cost of sales, excluding depreciation, amortization and distribution costs
(1)
|
Settlement loss
|
|
14
|
|
|
Cost of sales, excluding depreciation, amortization and distribution costs
(1)
|
|
|
(27
|
)
|
|
Income tax benefit (provision)
|
|
$
|
66
|
|
|
Net of tax
|
Total Reclassifications
|
$
|
56
|
|
|
Net of tax
|
(1)
|
These items are included in the computation of net periodic benefit cost related to our pension and OPEB plans summarized in
Note 13, “Pension and Other Postretirement Benefit Plans
.”
|
(In millions)
|
2015
|
|
2014
|
|
2013
|
|
Stock options
|
1.5
|
|
1.6
|
|
2.0
|
|
Stock unit awards
|
1.4
|
|
1.3
|
|
1.0
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
Raw materials and work in process
|
$
|
152
|
|
|
$
|
160
|
|
|
Finished goods
|
|
179
|
|
|
|
192
|
|
|
Mill stores and other supplies
|
|
210
|
|
|
|
190
|
|
|
|
$
|
541
|
|
|
$
|
542
|
|
|
(Dollars in millions)
|
Range of Estimated Useful Lives in Years
|
2015
|
|
|
2014
|
|
|
||
Land and land improvements
|
5 – 10
|
$
|
93
|
|
|
$
|
93
|
|
|
Buildings
|
3 – 40
|
|
302
|
|
|
|
293
|
|
|
Machinery and equipment
(1)
|
3 – 20
|
|
2,313
|
|
|
|
2,318
|
|
|
Hydroelectric power plants
|
10 – 40
|
|
287
|
|
|
|
286
|
|
|
Timberlands and timberlands improvements
|
3 – 20
|
|
99
|
|
|
|
91
|
|
|
Construction in progress
(1)
|
|
|
146
|
|
|
|
102
|
|
|
|
|
|
3,240
|
|
|
|
3,183
|
|
|
Less: Accumulated depreciation
|
|
|
(1,430
|
)
|
|
|
(1,198
|
)
|
|
|
|
$
|
1,810
|
|
|
$
|
1,985
|
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
Machinery and equipment
|
$
|
58
|
|
|
$
|
31
|
|
|
Construction in progress
|
|
10
|
|
|
|
24
|
|
|
|
|
68
|
|
|
|
55
|
|
|
Less: Accumulated depreciation
|
|
(16
|
)
|
|
|
(8
|
)
|
|
|
$
|
52
|
|
|
$
|
47
|
|
|
|
|
2015
|
|
2014
|
||||||||||||||||||||||
(Dollars in millions)
|
Estimated
Lives
(Years)
|
Gross
Carrying Value |
Accumulated
Amortization |
Net
|
|
Gross
Carrying Value |
Accumulated
Amortization |
Net
|
||||||||||||||||||
Water rights
(1)
|
10 – 40
|
$
|
19
|
|
|
$
|
4
|
|
|
$
|
15
|
|
|
|
$
|
19
|
|
|
$
|
3
|
|
|
$
|
16
|
|
|
Energy contracts
|
15 – 25
|
|
52
|
|
|
|
8
|
|
|
|
44
|
|
|
|
|
52
|
|
|
|
6
|
|
|
|
46
|
|
|
Customer relationships
(2)
|
10 – 15
|
|
44
|
|
|
|
—
|
|
|
|
44
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Other
(2)
|
|
|
2
|
|
|
|
—
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
$
|
117
|
|
|
$
|
12
|
|
|
$
|
105
|
|
|
|
$
|
71
|
|
|
$
|
9
|
|
|
$
|
62
|
|
|
(1)
|
In order to operate our hydroelectric generation and transmission network, we draw water from various rivers in Quebec. For some of our facilities, the use of such government-owned waters is governed by water power leases/agreements with the province of Quebec, which set out the terms, conditions, and fees (as applicable). Terms of these agreements typically range from
10
to
25 years
and are generally renewable, under certain conditions. In some cases, the agreements are contingent on the continued operation of the related paper mills and a minimum level of capital spending in the region. For our other facilities, the right to generate hydroelectricity stems from our ownership of the riverbed on which these facilities are located.
|
(2)
|
In connection with our acquisition of Atlas Paper, we identified amortizable intangible assets primarily related to customer relationships. See
Note 3, “Acquisition of Atlas Paper Holdings, Inc.
,” for additional information.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
Trade accounts payable
|
$
|
324
|
|
|
$
|
361
|
|
|
Payroll, bonuses and severance payable
|
|
56
|
|
|
|
85
|
|
|
Accrued interest
|
|
5
|
|
|
|
5
|
|
|
Pension and OPEB obligations
|
|
17
|
|
|
|
20
|
|
|
Income and other taxes payable
|
|
5
|
|
|
|
13
|
|
|
Environmental liabilities
|
|
5
|
|
|
|
8
|
|
|
Other
|
|
24
|
|
|
|
26
|
|
|
|
$
|
436
|
|
|
$
|
518
|
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
5.875% senior notes due 2023:
|
|
|
|
|
|
|
||
Principal amount
|
$
|
600
|
|
|
$
|
600
|
|
|
Deferred financing costs
|
|
(7
|
)
|
|
|
(7
|
)
|
|
Unamortized discount
|
|
(4
|
)
|
|
|
(5
|
)
|
|
Total senior notes due 2023
|
|
589
|
|
|
|
588
|
|
|
Capital lease obligation
|
|
2
|
|
|
|
2
|
|
|
Total debt
|
|
591
|
|
|
|
590
|
|
|
Less: Current portion of long-term debt
|
|
(1
|
)
|
|
|
(1
|
)
|
|
Long-term debt, net of current portion
|
$
|
590
|
|
|
$
|
589
|
|
|
Year (beginning May 15)
|
Redemption Price
|
2017
|
104.406%
|
2018
|
102.938%
|
2019
|
101.469%
|
2020 and thereafter
|
100.000%
|
|
Pension Plans
|
|
OPEB Plans
|
||||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
|
2015
|
|
|
2014
|
|
|
||||
Change in benefit obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Benefit obligations as of beginning of year
|
$
|
6,229
|
|
|
$
|
6,004
|
|
|
|
$
|
210
|
|
|
$
|
310
|
|
|
Service cost
|
|
23
|
|
|
|
26
|
|
|
|
|
1
|
|
|
|
1
|
|
|
Interest cost
|
|
225
|
|
|
|
274
|
|
|
|
|
8
|
|
|
|
11
|
|
|
Actuarial (gain) loss
|
|
(140
|
)
|
|
|
788
|
|
|
|
|
(11
|
)
|
|
|
10
|
|
|
Participant contributions
|
|
7
|
|
|
|
11
|
|
|
|
|
2
|
|
|
|
4
|
|
|
Plan amendments
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
(91
|
)
|
|
Curtailments
|
|
—
|
|
|
|
4
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Settlements
|
|
(65
|
)
|
|
|
(5
|
)
|
|
|
|
—
|
|
|
|
—
|
|
|
Benefits paid
|
|
(410
|
)
|
|
|
(440
|
)
|
|
|
|
(15
|
)
|
|
|
(23
|
)
|
|
Effect of foreign currency exchange rate changes
|
|
(801
|
)
|
|
|
(433
|
)
|
|
|
|
(21
|
)
|
|
|
(12
|
)
|
|
Benefit obligations as of end of year
|
|
5,068
|
|
|
|
6,229
|
|
|
|
|
174
|
|
|
|
210
|
|
|
Change in plan assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fair value of plan assets as of beginning of year
|
|
4,808
|
|
|
|
5,013
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Actual return on plan assets
|
|
224
|
|
|
|
450
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Employer contributions
|
|
123
|
|
|
|
142
|
|
|
|
|
13
|
|
|
|
19
|
|
|
Participant contributions
|
|
7
|
|
|
|
11
|
|
|
|
|
2
|
|
|
|
4
|
|
|
Settlements
|
|
(65
|
)
|
|
|
(5
|
)
|
|
|
|
—
|
|
|
|
—
|
|
|
Benefits paid
|
|
(410
|
)
|
|
|
(440
|
)
|
|
|
|
(15
|
)
|
|
|
(23
|
)
|
|
Effect of foreign currency exchange rate changes
|
|
(638
|
)
|
|
|
(363
|
)
|
|
|
|
—
|
|
|
|
—
|
|
|
Fair value of plan assets as of end of year
|
|
4,049
|
|
|
|
4,808
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Funded status as of end of year
|
$
|
(1,019
|
)
|
|
$
|
(1,421
|
)
|
|
|
$
|
(174
|
)
|
|
$
|
(210
|
)
|
|
Amounts recognized in our Consolidated Balance Sheets consisted of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other assets
|
$
|
10
|
|
|
$
|
5
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Accounts payable and accrued liabilities
|
|
(3
|
)
|
|
|
(4
|
)
|
|
|
|
(14
|
)
|
|
|
(16
|
)
|
|
Pension and OPEB obligations
|
|
(1,026
|
)
|
|
|
(1,422
|
)
|
|
|
|
(160
|
)
|
|
|
(194
|
)
|
|
Net obligations recognized
|
$
|
(1,019
|
)
|
|
$
|
(1,421
|
)
|
|
|
$
|
(174
|
)
|
|
$
|
(210
|
)
|
|
|
Pension Plans
|
|
OPEB Plans
|
||||||||||||||||||||||
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
||||||
Service cost
|
$
|
23
|
|
|
$
|
26
|
|
|
$
|
33
|
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
Interest cost
|
|
225
|
|
|
|
274
|
|
|
|
274
|
|
|
|
|
8
|
|
|
|
11
|
|
|
|
16
|
|
|
Expected return on plan assets
|
|
(260
|
)
|
|
|
(300
|
)
|
|
|
(308
|
)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Amortization of prior service credits
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
|
(14
|
)
|
|
|
(11
|
)
|
|
|
(1
|
)
|
|
Amortization of actuarial losses (gains)
|
|
84
|
|
|
|
9
|
|
|
|
25
|
|
|
|
|
(5
|
)
|
|
|
(4
|
)
|
|
|
(2
|
)
|
|
Net periodic benefit cost before special events
|
|
70
|
|
|
|
7
|
|
|
|
22
|
|
|
|
|
(10
|
)
|
|
|
(3
|
)
|
|
|
16
|
|
|
Curtailments and settlements
|
|
14
|
|
|
|
4
|
|
|
|
3
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
$
|
84
|
|
|
$
|
11
|
|
|
$
|
25
|
|
|
|
$
|
(10
|
)
|
|
$
|
(3
|
)
|
|
$
|
16
|
|
|
|
Pension Plans
|
|
OPEB Plans
|
||||||||||||||
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Benefit obligations:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.2
|
%
|
|
4.0
|
%
|
|
4.9
|
%
|
|
4.4
|
%
|
|
4.0
|
%
|
|
5.0
|
%
|
Rate of compensation increase
|
2.5
|
%
|
|
2.5
|
%
|
|
2.5
|
%
|
|
|
|
|
|
|
|
|
|
Net periodic benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.0
|
%
|
|
4.9
|
%
|
|
4.3
|
%
|
|
4.1
|
%
|
|
5.0
|
%
|
|
4.2
|
%
|
Expected return on assets
|
6.3
|
%
|
|
6.5
|
%
|
|
6.3
|
%
|
|
|
|
|
|
|
|
|
|
Rate of compensation increase
|
2.5
|
%
|
|
2.5
|
%
|
|
2.5
|
%
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
||||||||||
|
Domestic Plans
|
Foreign Plans
|
|
Domestic Plans
|
Foreign Plans
|
||||||||
Health care cost trend rate assumed for next year
|
7.2
|
%
|
|
4.4
|
%
|
|
|
7.2
|
%
|
|
4.4
|
%
|
|
Rate to which the cost trend rate is assumed to decline (ultimate trend rate)
|
4.5
|
%
|
|
3.8
|
%
|
|
|
4.5
|
%
|
|
3.8
|
%
|
|
Year that the rate reaches the ultimate trend rate
|
2028
|
|
|
2033
|
|
|
|
2028
|
|
|
2033
|
|
|
(In millions)
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. companies
|
$
|
587
|
|
|
$
|
587
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Non-U.S. companies
|
|
626
|
|
|
|
626
|
|
|
|
—
|
|
|
|
—
|
|
|
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate and government securities
|
|
2,243
|
|
|
|
274
|
|
|
|
1,969
|
|
|
|
—
|
|
|
Asset-backed securities
|
|
97
|
|
|
|
—
|
|
|
|
97
|
|
|
|
—
|
|
|
Cash and cash equivalents
|
|
191
|
|
|
|
191
|
|
|
|
—
|
|
|
|
—
|
|
|
Accrued interest and dividends
|
|
36
|
|
|
|
—
|
|
|
|
36
|
|
|
|
—
|
|
|
Total before investments measured at NAV
|
$
|
3,780
|
|
|
$
|
1,678
|
|
|
$
|
2,102
|
|
|
$
|
—
|
|
|
Investments measured at NAV
|
|
269
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
$
|
4,049
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. companies
|
$
|
678
|
|
|
$
|
678
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Non-U.S. companies
|
|
723
|
|
|
|
723
|
|
|
|
—
|
|
|
|
—
|
|
|
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate and government securities
|
|
2,665
|
|
|
|
494
|
|
|
|
2,171
|
|
|
|
—
|
|
|
Asset-backed securities
|
|
110
|
|
|
|
—
|
|
|
|
110
|
|
|
|
—
|
|
|
Bank loans/foreign annuities
|
|
4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
Cash and cash equivalents
|
|
197
|
|
|
|
197
|
|
|
|
—
|
|
|
|
—
|
|
|
Accrued interest and dividends
|
|
42
|
|
|
|
—
|
|
|
|
42
|
|
|
|
—
|
|
|
Total before investments measured at NAV
|
$
|
4,419
|
|
|
$
|
2,092
|
|
|
$
|
2,323
|
|
|
$
|
4
|
|
|
Investments measured at NAV
|
|
389
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
$
|
4,808
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
Bank Loans / Foreign Annuities
|
|||
Balance as of December 31, 2013
|
$
|
40
|
|
|
Unrealized losses relating to assets held as of December 31, 2014
|
|
(2
|
)
|
|
Realized gains
|
|
2
|
|
|
Purchases
|
|
11
|
|
|
Sales
|
|
(44
|
)
|
|
Effect of foreign currency exchange rate changes
|
|
(3
|
)
|
|
Balance as of December 31, 2014
|
|
4
|
|
|
Sales
|
|
(4
|
)
|
|
Balance as of December 31, 2015
|
$
|
—
|
|
|
(In millions)
|
Pension Plans
(1)
|
OPEB Plans
|
||||||
2016
|
$
|
344
|
|
|
$
|
14
|
|
|
2017
|
|
345
|
|
|
|
13
|
|
|
2018
|
|
343
|
|
|
|
13
|
|
|
2019
|
|
342
|
|
|
|
12
|
|
|
2020
|
|
339
|
|
|
|
12
|
|
|
2021 - 2025
|
|
1,638
|
|
|
|
56
|
|
|
(1)
|
Benefit payments are expected be paid from the plans’ net assets.
|
•
|
abide by the compensation plan detailed in the Plans of Reorganization (as defined in
Note 16, “Share Capital
– Common stock”) with respect to salaries, bonuses and severance;
|
•
|
direct at least 60% of the maintenance and value-creation investments earmarked for our Canadian pulp and paper operations to projects in Quebec;
|
•
|
maintain our head office and the then-current related functions in Quebec; and
|
•
|
make an additional solvency deficit reduction contribution to its Quebec pension plans of Cdn $75, payable over four years, for each metric ton of capacity reduced in Quebec, in the event of downtime of more than six consecutive months or nine cumulative months over a period of 18 months;
|
•
|
the prohibition on the payment of dividends by our Canadian subsidiary at any time when the weighted average solvency ratio of the Quebec pension plans is less than 80%;
|
•
|
the requirement to invest a minimum of Cdn $75 million in strategic projects in Quebec over a five-year period; and
|
•
|
the obligation to create a diversification fund by contributing Cdn $2 million per year for five years for the benefit of the municipalities and workers in the Quebec operating regions.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
United States
|
$
|
(355
|
)
|
|
$
|
(221
|
)
|
|
$
|
(168
|
)
|
|
Foreign
|
|
99
|
|
|
|
(83
|
)
|
|
|
53
|
|
|
|
$
|
(256
|
)
|
|
$
|
(304
|
)
|
|
$
|
(115
|
)
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
U.S. Federal and State:
|
|
|
|
|
|
|
|
|
|
|||
Current
|
$
|
4
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
Deferred
|
|
32
|
|
|
|
6
|
|
|
|
(504
|
)
|
|
|
|
36
|
|
|
|
2
|
|
|
|
(504
|
)
|
|
Foreign:
|
|
|
|
|
|
|
|
|
|
|||
Current
|
|
—
|
|
|
|
(2
|
)
|
|
|
(1
|
)
|
|
Deferred
|
|
(35
|
)
|
|
|
30
|
|
|
|
(19
|
)
|
|
|
|
(35
|
)
|
|
|
28
|
|
|
|
(20
|
)
|
|
Total:
|
|
|
|
|
|
|
|
|
|
|||
Current
|
|
4
|
|
|
|
(6
|
)
|
|
|
(1
|
)
|
|
Deferred
|
|
(3
|
)
|
|
|
36
|
|
|
|
(523
|
)
|
|
|
$
|
1
|
|
|
$
|
30
|
|
|
$
|
(524
|
)
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
Loss before income taxes
|
$
|
(256
|
)
|
|
$
|
(304
|
)
|
|
$
|
(115
|
)
|
|
Income tax benefit (provision):
|
|
|
|
|
|
|
|
|
|
|||
Expected income tax benefit
|
|
90
|
|
|
|
106
|
|
|
|
40
|
|
|
Changes resulting from:
|
|
|
|
|
|
|
|
|
|
|||
Valuation allowance
(1)
|
|
(109
|
)
|
|
|
(51
|
)
|
|
|
(572
|
)
|
|
Foreign exchange
|
|
(20
|
)
|
|
|
(17
|
)
|
|
|
(4
|
)
|
|
Research and development tax incentives
|
|
1
|
|
|
|
1
|
|
|
|
2
|
|
|
State income taxes, net of federal income tax benefit
|
|
12
|
|
|
|
5
|
|
|
|
3
|
|
|
Foreign tax rate differences
|
|
8
|
|
|
|
(8
|
)
|
|
|
4
|
|
|
Effect of change in tax rates
(2)
|
|
18
|
|
|
|
—
|
|
|
|
—
|
|
|
Other, net
|
|
1
|
|
|
|
(6
|
)
|
|
|
3
|
|
|
|
$
|
1
|
|
|
$
|
30
|
|
|
$
|
(524
|
)
|
|
(1)
|
During 2015, we recorded a net increase in our valuation allowance of
$109 million
primarily related to our U.S. operations where we recognize a full valuation allowance against our net deferred income tax assets.
|
(2)
|
In 2015, we recorded an income tax benefit of
$18 million
as a result of a change in tax rates on deferred income taxes, primarily due to an intercompany asset transfer in connection with an operating company realignment.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
Fixed assets
|
$
|
(81
|
)
|
|
$
|
(191
|
)
|
|
Deferred gains
|
|
(21
|
)
|
|
|
—
|
|
|
Other liabilities
|
|
(9
|
)
|
|
|
(13
|
)
|
|
Deferred income tax liabilities
|
|
(111
|
)
|
|
|
(204
|
)
|
|
Fixed assets
|
|
489
|
|
|
|
591
|
|
|
Pension and OPEB plans
|
|
359
|
|
|
|
480
|
|
|
Ordinary loss carryforwards
|
|
773
|
|
|
|
767
|
|
|
Capital loss carryforwards
(1)
|
|
12
|
|
|
|
3
|
|
|
Research and development expense pool
|
|
177
|
|
|
|
204
|
|
|
Tax credit carryforwards
|
|
103
|
|
|
|
109
|
|
|
Other assets
|
|
43
|
|
|
|
91
|
|
|
Deferred income tax assets
|
|
1,956
|
|
|
|
2,245
|
|
|
Valuation allowance
|
|
(865
|
)
|
|
|
(755
|
)
|
|
Net deferred income tax assets
|
$
|
980
|
|
|
$
|
1,286
|
|
|
Amounts recognized in our Consolidated Balance Sheets consisted of:
|
|
|
|
|
|
|
||
Deferred income tax assets
|
$
|
982
|
|
|
$
|
1,289
|
|
|
Deferred income tax liabilities
|
|
(2
|
)
|
|
|
(3
|
)
|
|
Net deferred income tax assets
|
$
|
980
|
|
|
$
|
1,286
|
|
|
(1)
|
During 2014, all of our U.S. capital loss carryforwards expired unutilized. Accordingly,
$440 million
of U.S. deferred income tax assets related to the capital loss carryforwards were offset by a corresponding reduction in the valuation allowance.
|
(In millions)
|
Related
Deferred Income Tax Asset |
Year of
Expiration
|
||||
Ordinary loss carryforwards:
|
|
|
|
|
||
U.S. Federal ordinary loss carryforwards of $1,882
|
$
|
659
|
|
(1
|
)
|
2021 – 2035
|
U.S. State ordinary loss carryforwards of $1,663
|
|
69
|
|
(1
|
)
|
2016 – 2035
|
Canadian Federal and provincial (excluding Quebec) ordinary loss carryforwards of $79
|
|
14
|
|
|
2025 – 2035
|
|
Quebec ordinary loss carryforwards of
$62
|
|
7
|
|
|
2025 – 2032
|
|
Other ordinary loss carryforwards
|
|
24
|
|
|
2019 – 2025
|
|
|
$
|
773
|
|
|
|
|
Capital loss carryforwards:
|
|
|
|
|
||
Canadian capital loss carryforwards of
$42
|
|
12
|
|
|
Indefinite
|
|
|
$
|
12
|
|
|
|
|
Research and development expense pool:
|
|
|
|
|
||
Canadian Federal and provincial (excluding Quebec) research and development expense pool of $615
|
$
|
103
|
|
|
Indefinite
|
|
Quebec research and development expense pool of $752
|
|
74
|
|
|
Indefinite
|
|
|
$
|
177
|
|
|
|
|
Tax credit carryforwards:
|
|
|
|
|
||
Canadian research and development tax credit carryforwards
|
$
|
91
|
|
|
2021 – 2036
|
|
U.S. State tax credit carryforwards
|
|
12
|
|
(1
|
)
|
2016 – 2030
|
|
$
|
103
|
|
|
|
(1)
|
As of December 31, 2015, we had a full valuation allowance against our U.S. operations net deferred income tax assets.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
Beginning of year
|
$
|
109
|
|
|
$
|
81
|
|
|
Increase (decrease) in unrecognized tax benefits resulting from:
|
|
|
|
|
|
|
||
Positions taken in the current period
|
|
2
|
|
|
|
38
|
|
|
Expirations of statute limitations
|
|
(2
|
)
|
|
|
—
|
|
|
Settlements with taxing authorities
|
|
(1
|
)
|
|
|
(4
|
)
|
|
Change in Canadian foreign exchange rate
|
|
(11
|
)
|
|
|
(6
|
)
|
|
End of year
|
$
|
97
|
|
|
$
|
109
|
|
|
|
2013
|
|||
Exercise price
|
$
|
15.66
|
|
|
Fair value
|
$
|
7.65
|
|
|
Expected dividend yield
|
|
—
|
|
|
Expected volatility
|
|
50.0
|
%
|
|
Risk-free interest rate
|
|
1.8
|
%
|
|
Expected life in years
|
|
6.25
|
|
|
|
Number of
Shares
|
Weighted-
Average
Exercise
Price
|
Weighted-
Average
Contractual
Life (years)
|
Aggregate
Intrinsic
Value
(in millions)
|
|||||||||
Balance as of December 31, 2014
|
1,583,941
|
|
|
$
|
15.87
|
|
|
7.8
|
|
$
|
4
|
|
|
Exercised
|
(41,115
|
)
|
|
|
13.18
|
|
|
|
|
|
|
|
|
Forfeited
|
(16,317
|
)
|
|
|
16.21
|
|
|
|
|
|
|
|
|
Expired
|
(48,896
|
)
|
|
|
21.55
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2015
|
1,477,613
|
|
|
$
|
15.76
|
|
|
6.8
|
|
$
|
—
|
|
|
Exercisable as of December 31, 2015
|
983,081
|
|
|
$
|
16.49
|
|
|
6.5
|
|
$
|
—
|
|
|
|
Number of
Units
|
Weighted-
Average Fair
Value at Grant
Date
|
|||||
Balance as of December 31, 2014
|
294,761
|
|
|
$
|
18.61
|
|
|
Granted
|
702,829
|
|
|
|
7.54
|
|
|
Forfeited
|
(6,204
|
)
|
|
|
18.61
|
|
|
Balance as of December 31, 2015
|
991,386
|
|
|
$
|
10.76
|
|
|
(In millions)
|
Purchase Obligations
(1)
|
Operating
Leases
|
||||||
2016
|
$
|
119
|
|
|
$
|
6
|
|
|
2017
|
|
91
|
|
|
|
5
|
|
|
2018
|
|
64
|
|
|
|
4
|
|
|
2019
|
|
50
|
|
|
|
4
|
|
|
2020
|
|
41
|
|
|
|
4
|
|
|
Thereafter
|
|
24
|
|
|
|
14
|
|
|
|
$
|
389
|
|
|
$
|
37
|
|
|
(1)
|
Includes energy purchase obligations of
$254 million
through 2020 for certain of our pulp and paper mills.
|
(In millions)
|
Market
Pulp
(1)
|
Tissue
(2)
|
Wood
Products
(3)
|
Newsprint
|
Specialty
Papers
|
Segment
Total
|
Corporate
and Other
|
Total
|
||||||||||||||||||||||||
Sales
|
||||||||||||||||||||||||||||||||
2015
|
$
|
889
|
|
|
$
|
11
|
|
|
$
|
536
|
|
|
$
|
1,105
|
|
|
$
|
1,104
|
|
|
$
|
3,645
|
|
|
$
|
—
|
|
|
$
|
3,645
|
|
|
2014
|
|
974
|
|
|
|
—
|
|
|
|
610
|
|
|
|
1,402
|
|
|
|
1,272
|
|
|
|
4,258
|
|
|
|
—
|
|
|
|
4,258
|
|
|
2013
|
|
1,053
|
|
|
|
—
|
|
|
|
569
|
|
|
|
1,473
|
|
|
|
1,366
|
|
|
|
4,461
|
|
|
|
—
|
|
|
|
4,461
|
|
|
Depreciation and amortization
|
||||||||||||||||||||||||||||||||
2015
|
$
|
53
|
|
|
$
|
1
|
|
|
$
|
37
|
|
|
$
|
64
|
|
|
$
|
71
|
|
|
$
|
226
|
|
|
$
|
11
|
|
|
$
|
237
|
|
|
2014
|
|
53
|
|
|
|
—
|
|
|
|
33
|
|
|
|
69
|
|
|
|
82
|
|
|
|
237
|
|
|
|
6
|
|
|
|
243
|
|
|
2013
|
|
52
|
|
|
|
—
|
|
|
|
36
|
|
|
|
73
|
|
|
|
77
|
|
|
|
238
|
|
|
|
5
|
|
|
|
243
|
|
|
Operating income (loss)
|
||||||||||||||||||||||||||||||||
2015
|
$
|
76
|
|
|
$
|
(1
|
)
|
|
$
|
2
|
|
|
$
|
(23
|
)
|
|
$
|
29
|
|
|
$
|
83
|
|
|
$
|
(302
|
)
|
|
$
|
(219
|
)
|
|
2014
|
|
63
|
|
|
|
—
|
|
|
|
69
|
|
|
|
20
|
|
|
|
(19
|
)
|
|
|
133
|
|
|
|
(307
|
)
|
|
|
(174
|
)
|
|
2013
|
|
43
|
|
|
|
—
|
|
|
|
41
|
|
|
|
39
|
|
|
|
39
|
|
|
|
162
|
|
|
|
(164
|
)
|
|
|
(2
|
)
|
|
Capital expenditures
|
||||||||||||||||||||||||||||||||
2015
|
$
|
60
|
|
|
$
|
41
|
|
|
$
|
43
|
|
|
$
|
10
|
|
|
$
|
13
|
|
|
$
|
167
|
|
|
$
|
18
|
|
|
$
|
185
|
|
|
2014
|
|
23
|
|
|
|
—
|
|
|
|
77
|
|
|
|
39
|
|
|
|
34
|
|
|
|
173
|
|
|
|
20
|
|
|
|
193
|
|
|
2013
|
|
40
|
|
|
|
—
|
|
|
|
31
|
|
|
|
57
|
|
|
|
17
|
|
|
|
145
|
|
|
|
16
|
|
|
|
161
|
|
|
(1)
|
Market pulp sales excluded inter-segment sales of
$20 million
,
$19 million
and
$17 million
for the years ended
December 31, 2015
,
2014
and
2013
, respectively.
|
(2)
|
Tissue capital expenditures of
$41 million
for the year ended
December 31, 2015
consisted of construction in progress expenditures for the tissue manufacturing and converting facility in Calhoun.
|
(3)
|
Wood sales to our joint ventures, which are transacted at arm’s length negotiated prices, were
$20 million
,
$24 million
and
$18 million
for the years ended
December 31, 2015
,
2014
and
2013
, respectively.
|
(In millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||
United States
|
$
|
2,421
|
|
|
$
|
2,809
|
|
|
$
|
2,834
|
|
|
Foreign countries:
|
|
|
|
|
|
|
|
|
|
|||
Canada
|
|
476
|
|
|
|
540
|
|
|
|
546
|
|
|
Mexico
|
|
150
|
|
|
|
174
|
|
|
|
168
|
|
|
Brazil
|
|
70
|
|
|
|
107
|
|
|
|
122
|
|
|
Other countries
|
|
528
|
|
|
|
628
|
|
|
|
791
|
|
|
|
|
1,224
|
|
|
|
1,449
|
|
|
|
1,627
|
|
|
|
$
|
3,645
|
|
|
$
|
4,258
|
|
|
$
|
4,461
|
|
|
(In millions)
|
2015
|
|
|
2014
|
|
|
||
United States
|
$
|
677
|
|
|
$
|
791
|
|
|
Foreign countries:
|
|
|
|
|
|
|
||
Canada
|
|
1,323
|
|
|
|
1,346
|
|
|
South Korea
|
|
22
|
|
|
|
24
|
|
|
|
|
1,345
|
|
|
|
1,370
|
|
|
|
$
|
2,022
|
|
|
$
|
2,161
|
|
|
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
|
||||||||||||||||||||
For the Year Ended December 31, 2015
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries
|
Non-guarantor
Subsidiaries
|
Consolidating
Adjustments
|
Consolidated
|
|||||||||||||||
Sales
|
$
|
—
|
|
|
$
|
2,975
|
|
|
$
|
2,223
|
|
|
$
|
(1,553
|
)
|
|
$
|
3,645
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of sales, excluding depreciation, amortization and distribution costs
|
|
—
|
|
|
|
2,780
|
|
|
|
1,601
|
|
|
|
(1,555
|
)
|
|
|
2,826
|
|
|
Depreciation and amortization
|
|
—
|
|
|
|
93
|
|
|
|
144
|
|
|
|
—
|
|
|
|
237
|
|
|
Distribution costs
|
|
—
|
|
|
|
168
|
|
|
|
293
|
|
|
|
(1
|
)
|
|
|
460
|
|
|
Selling, general and administrative expenses
|
|
19
|
|
|
|
55
|
|
|
|
86
|
|
|
|
—
|
|
|
|
160
|
|
|
Closure costs, impairment and other related charges
|
|
—
|
|
|
|
176
|
|
|
|
5
|
|
|
|
—
|
|
|
|
181
|
|
|
Operating (loss) income
|
|
(19
|
)
|
|
|
(297
|
)
|
|
|
94
|
|
|
|
3
|
|
|
|
(219
|
)
|
|
Interest expense
|
|
(75
|
)
|
|
|
—
|
|
|
|
(12
|
)
|
|
|
46
|
|
|
|
(41
|
)
|
|
Other income, net
|
|
—
|
|
|
|
37
|
|
|
|
13
|
|
|
|
(46
|
)
|
|
|
4
|
|
|
Equity in (loss) income of subsidiaries
|
|
(163
|
)
|
|
|
20
|
|
|
|
—
|
|
|
|
143
|
|
|
|
—
|
|
|
(Loss) income before income taxes
|
|
(257
|
)
|
|
|
(240
|
)
|
|
|
95
|
|
|
|
146
|
|
|
|
(256
|
)
|
|
Income tax benefit (provision)
|
|
—
|
|
|
|
36
|
|
|
|
(34
|
)
|
|
|
(1
|
)
|
|
|
1
|
|
|
Net (loss) income including noncontrolling interests
|
|
(257
|
)
|
|
|
(204
|
)
|
|
|
61
|
|
|
|
145
|
|
|
|
(255
|
)
|
|
Net income attributable to noncontrolling interests
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Net (loss) income attributable to Resolute Forest Products Inc.
|
$
|
(257
|
)
|
|
$
|
(204
|
)
|
|
$
|
59
|
|
|
$
|
145
|
|
|
$
|
(257
|
)
|
|
Comprehensive (loss) income attributable to Resolute Forest Products Inc.
|
$
|
(126
|
)
|
|
$
|
(169
|
)
|
|
$
|
155
|
|
|
$
|
14
|
|
|
$
|
(126
|
)
|
|
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
|
||||||||||||||||||||
For the Year Ended December 31, 2014
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries
|
Non-guarantor
Subsidiaries
|
Consolidating
Adjustments
|
Consolidated
|
|||||||||||||||
Sales
|
$
|
—
|
|
|
$
|
3,475
|
|
|
$
|
2,807
|
|
|
$
|
(2,024
|
)
|
|
$
|
4,258
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of sales, excluding depreciation, amortization and distribution costs
|
|
—
|
|
|
|
3,225
|
|
|
|
2,036
|
|
|
|
(2,021
|
)
|
|
|
3,240
|
|
|
Depreciation and amortization
|
|
—
|
|
|
|
94
|
|
|
|
149
|
|
|
|
—
|
|
|
|
243
|
|
|
Distribution costs
|
|
—
|
|
|
|
168
|
|
|
|
352
|
|
|
|
(2
|
)
|
|
|
518
|
|
|
Selling, general and administrative expenses
|
|
17
|
|
|
|
46
|
|
|
|
92
|
|
|
|
—
|
|
|
|
155
|
|
|
Closure costs, impairment and other related charges
|
|
—
|
|
|
|
51
|
|
|
|
227
|
|
|
|
—
|
|
|
|
278
|
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Operating loss
|
|
(17
|
)
|
|
|
(109
|
)
|
|
|
(47
|
)
|
|
|
(1
|
)
|
|
|
(174
|
)
|
|
Interest expense
|
|
(71
|
)
|
|
|
(4
|
)
|
|
|
(8
|
)
|
|
|
36
|
|
|
|
(47
|
)
|
|
Other expense, net
|
|
(1
|
)
|
|
|
(20
|
)
|
|
|
(26
|
)
|
|
|
(36
|
)
|
|
|
(83
|
)
|
|
Equity in loss of subsidiaries
|
|
(188
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
188
|
|
|
|
—
|
|
|
Loss before income taxes
|
|
(277
|
)
|
|
|
(133
|
)
|
|
|
(81
|
)
|
|
|
187
|
|
|
|
(304
|
)
|
|
Income tax benefit
|
|
—
|
|
|
|
2
|
|
|
|
27
|
|
|
|
1
|
|
|
|
30
|
|
|
Net loss including noncontrolling interests
|
|
(277
|
)
|
|
|
(131
|
)
|
|
|
(54
|
)
|
|
|
188
|
|
|
|
(274
|
)
|
|
Net income attributable to noncontrolling interests
|
|
—
|
|
|
|
—
|
|
|
|
(3
|
)
|
|
|
—
|
|
|
|
(3
|
)
|
|
Net loss attributable to Resolute Forest Products Inc.
|
$
|
(277
|
)
|
|
$
|
(131
|
)
|
|
$
|
(57
|
)
|
|
$
|
188
|
|
|
$
|
(277
|
)
|
|
Comprehensive loss attributable to Resolute Forest Products Inc.
|
$
|
(724
|
)
|
|
$
|
(250
|
)
|
|
$
|
(385
|
)
|
|
$
|
635
|
|
|
$
|
(724
|
)
|
|
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
|
||||||||||||||||||||
For the Year Ended December 31, 2013
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries |
Non-guarantor
Subsidiaries |
Consolidating
Adjustments |
Consolidated
|
|||||||||||||||
Sales
|
$
|
—
|
|
|
$
|
3,674
|
|
|
$
|
2,956
|
|
|
$
|
(2,169
|
)
|
|
$
|
4,461
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of sales, excluding depreciation, amortization and distribution costs
|
|
—
|
|
|
|
3,356
|
|
|
|
2,247
|
|
|
|
(2,157
|
)
|
|
|
3,446
|
|
|
Depreciation and amortization
|
|
—
|
|
|
|
100
|
|
|
|
143
|
|
|
|
—
|
|
|
|
243
|
|
|
Distribution costs
|
|
—
|
|
|
|
172
|
|
|
|
357
|
|
|
|
(8
|
)
|
|
|
521
|
|
|
Selling, general and administrative expenses
|
|
18
|
|
|
|
47
|
|
|
|
101
|
|
|
|
—
|
|
|
|
166
|
|
|
Closure costs, impairment and other related charges
|
|
—
|
|
|
|
61
|
|
|
|
28
|
|
|
|
—
|
|
|
|
89
|
|
|
Net gain on disposition of assets
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Operating (loss) income
|
|
(18
|
)
|
|
|
(62
|
)
|
|
|
82
|
|
|
|
(4
|
)
|
|
|
(2
|
)
|
|
Interest expense
|
|
(89
|
)
|
|
|
(4
|
)
|
|
|
(8
|
)
|
|
|
50
|
|
|
|
(51
|
)
|
|
Other (expense) income, net
|
|
(60
|
)
|
|
|
66
|
|
|
|
(18
|
)
|
|
|
(50
|
)
|
|
|
(62
|
)
|
|
Equity in loss of subsidiaries
|
|
(472
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
472
|
|
|
|
—
|
|
|
(Loss) income before income taxes
|
|
(639
|
)
|
|
|
—
|
|
|
|
56
|
|
|
|
468
|
|
|
|
(115
|
)
|
|
Income tax provision
|
|
—
|
|
|
|
(564
|
)
|
|
|
(21
|
)
|
|
|
61
|
|
|
|
(524
|
)
|
|
Net (loss) income including noncontrolling interests
|
|
(639
|
)
|
|
|
(564
|
)
|
|
|
35
|
|
|
|
529
|
|
|
|
(639
|
)
|
|
Net income attributable to noncontrolling interests
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Net (loss) income attributable to Resolute Forest Products Inc.
|
$
|
(639
|
)
|
|
$
|
(564
|
)
|
|
$
|
35
|
|
|
$
|
529
|
|
|
$
|
(639
|
)
|
|
Comprehensive (loss) income attributable to Resolute Forest Products Inc.
|
$
|
(296
|
)
|
|
$
|
(346
|
)
|
|
$
|
217
|
|
|
$
|
129
|
|
|
$
|
(296
|
)
|
|
CONDENSED CONSOLIDATING BALANCE SHEET
|
||||||||||||||||||||
As of December 31, 2015
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries
|
Non-guarantor
Subsidiaries
|
Consolidating
Adjustments
|
Consolidated
|
|||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
58
|
|
|
Accounts receivable, net
|
|
—
|
|
|
|
322
|
|
|
|
137
|
|
|
|
—
|
|
|
|
459
|
|
|
Accounts receivable from affiliates
|
|
—
|
|
|
|
421
|
|
|
|
272
|
|
|
|
(693
|
)
|
|
|
—
|
|
|
Inventories, net
|
|
—
|
|
|
|
257
|
|
|
|
290
|
|
|
|
(6
|
)
|
|
|
541
|
|
|
Advance and interest receivable from parent
|
|
—
|
|
|
|
62
|
|
|
|
—
|
|
|
|
(62
|
)
|
|
|
—
|
|
|
Notes and interest receivable from affiliates
|
|
—
|
|
|
|
48
|
|
|
|
—
|
|
|
|
(48
|
)
|
|
|
—
|
|
|
Other current assets
|
|
—
|
|
|
|
22
|
|
|
|
31
|
|
|
|
—
|
|
|
|
53
|
|
|
Total current assets
|
|
—
|
|
|
|
1,145
|
|
|
|
775
|
|
|
|
(809
|
)
|
|
|
1,111
|
|
|
Fixed assets, net
|
|
—
|
|
|
|
629
|
|
|
|
1,181
|
|
|
|
—
|
|
|
|
1,810
|
|
|
Amortizable intangible assets, net
|
|
—
|
|
|
|
46
|
|
|
|
59
|
|
|
|
—
|
|
|
|
105
|
|
|
Goodwill
|
|
—
|
|
|
|
59
|
|
|
|
—
|
|
|
|
—
|
|
|
|
59
|
|
|
Deferred income tax assets
|
|
—
|
|
|
|
—
|
|
|
|
981
|
|
|
|
1
|
|
|
|
982
|
|
|
Notes receivable from parent
|
|
—
|
|
|
|
710
|
|
|
|
—
|
|
|
|
(710
|
)
|
|
|
—
|
|
|
Note receivable from affiliate
|
|
—
|
|
|
|
105
|
|
|
|
—
|
|
|
|
(105
|
)
|
|
|
—
|
|
|
Investments in consolidated subsidiaries and affiliates
|
|
4,067
|
|
|
|
2,047
|
|
|
|
—
|
|
|
|
(6,114
|
)
|
|
|
—
|
|
|
Other assets
|
|
—
|
|
|
|
48
|
|
|
|
105
|
|
|
|
—
|
|
|
|
153
|
|
|
Total assets
|
$
|
4,067
|
|
|
$
|
4,789
|
|
|
$
|
3,101
|
|
|
$
|
(7,737
|
)
|
|
$
|
4,220
|
|
|
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and accrued liabilities
|
$
|
5
|
|
|
$
|
189
|
|
|
$
|
242
|
|
|
$
|
—
|
|
|
$
|
436
|
|
|
Current portion of long-term debt
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
Accounts payable to affiliates
|
|
433
|
|
|
|
260
|
|
|
|
—
|
|
|
|
(693
|
)
|
|
|
—
|
|
|
Advance and interest payable to subsidiaries
|
|
62
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(62
|
)
|
|
|
—
|
|
|
Notes and interest payable to affiliate
|
|
—
|
|
|
|
—
|
|
|
|
48
|
|
|
|
(48
|
)
|
|
|
—
|
|
|
Total current liabilities
|
|
500
|
|
|
|
450
|
|
|
|
290
|
|
|
|
(803
|
)
|
|
|
437
|
|
|
Long-term debt, net of current portion
|
|
589
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
590
|
|
|
Notes payable to subsidiaries
|
|
710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(710
|
)
|
|
|
—
|
|
|
Note payable to affiliate
|
|
—
|
|
|
|
—
|
|
|
|
105
|
|
|
|
(105
|
)
|
|
|
—
|
|
|
Pension and other postretirement benefit obligations
|
|
—
|
|
|
|
352
|
|
|
|
834
|
|
|
|
—
|
|
|
|
1,186
|
|
|
Deferred income tax liabilities
|
|
—
|
|
|
|
—
|
|
|
|
2
|
|
|
|
—
|
|
|
|
2
|
|
|
Other liabilities
|
|
1
|
|
|
|
24
|
|
|
|
35
|
|
|
|
—
|
|
|
|
60
|
|
|
Total liabilities
|
|
1,800
|
|
|
|
827
|
|
|
|
1,266
|
|
|
|
(1,618
|
)
|
|
|
2,275
|
|
|
Total equity
|
|
2,267
|
|
|
|
3,962
|
|
|
|
1,835
|
|
|
|
(6,119
|
)
|
|
|
1,945
|
|
|
Total liabilities and equity
|
$
|
4,067
|
|
|
$
|
4,789
|
|
|
$
|
3,101
|
|
|
$
|
(7,737
|
)
|
|
$
|
4,220
|
|
|
CONDENSED CONSOLIDATING BALANCE SHEET
|
||||||||||||||||||||
As of December 31, 2014
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries
|
Non-guarantor
Subsidiaries
|
Consolidating
Adjustments
|
Consolidated
|
|||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
257
|
|
|
$
|
80
|
|
|
$
|
—
|
|
|
$
|
337
|
|
|
Accounts receivable, net
|
|
—
|
|
|
|
383
|
|
|
|
156
|
|
|
|
—
|
|
|
|
539
|
|
|
Accounts receivable from affiliates
|
|
—
|
|
|
|
384
|
|
|
|
95
|
|
|
|
(479
|
)
|
|
|
—
|
|
|
Inventories, net
|
|
—
|
|
|
|
251
|
|
|
|
300
|
|
|
|
(9
|
)
|
|
|
542
|
|
|
Note and interest receivable from parent
|
|
—
|
|
|
|
287
|
|
|
|
—
|
|
|
|
(287
|
)
|
|
|
—
|
|
|
Notes receivable from affiliates
|
|
—
|
|
|
|
318
|
|
|
|
—
|
|
|
|
(318
|
)
|
|
|
—
|
|
|
Other current assets
|
|
—
|
|
|
|
20
|
|
|
|
26
|
|
|
|
—
|
|
|
|
46
|
|
|
Total current assets
|
|
—
|
|
|
|
1,900
|
|
|
|
657
|
|
|
|
(1,093
|
)
|
|
|
1,464
|
|
|
Fixed assets, net
|
|
—
|
|
|
|
742
|
|
|
|
1,243
|
|
|
|
—
|
|
|
|
1,985
|
|
|
Amortizable intangible assets, net
|
|
—
|
|
|
|
—
|
|
|
|
62
|
|
|
|
—
|
|
|
|
62
|
|
|
Deferred income tax assets
|
|
—
|
|
|
|
—
|
|
|
|
1,287
|
|
|
|
2
|
|
|
|
1,289
|
|
|
Note receivable from parent
|
|
—
|
|
|
|
388
|
|
|
|
—
|
|
|
|
(388
|
)
|
|
|
—
|
|
|
Investments in consolidated subsidiaries and affiliates
|
|
4,096
|
|
|
|
2,020
|
|
|
|
—
|
|
|
|
(6,116
|
)
|
|
|
—
|
|
|
Other assets
|
|
—
|
|
|
|
49
|
|
|
|
65
|
|
|
|
—
|
|
|
|
114
|
|
|
Total assets
|
$
|
4,096
|
|
|
$
|
5,099
|
|
|
$
|
3,314
|
|
|
$
|
(7,595
|
)
|
|
$
|
4,914
|
|
|
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and accrued liabilities
|
$
|
5
|
|
|
$
|
193
|
|
|
$
|
320
|
|
|
$
|
—
|
|
|
$
|
518
|
|
|
Current portion of long-term debt
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
Accounts payable to affiliates
|
|
386
|
|
|
|
93
|
|
|
|
—
|
|
|
|
(479
|
)
|
|
|
—
|
|
|
Note and interest payable to subsidiary
|
|
287
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(287
|
)
|
|
|
—
|
|
|
Notes payable to affiliate
|
|
—
|
|
|
|
—
|
|
|
|
318
|
|
|
|
(318
|
)
|
|
|
—
|
|
|
Total current liabilities
|
|
678
|
|
|
|
287
|
|
|
|
638
|
|
|
|
(1,084
|
)
|
|
|
519
|
|
|
Long-term debt, net of current portion
|
|
588
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
589
|
|
|
Note payable to subsidiary
|
|
388
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(388
|
)
|
|
|
—
|
|
|
Pension and other postretirement benefit obligations
|
|
—
|
|
|
|
414
|
|
|
|
1,202
|
|
|
|
—
|
|
|
|
1,616
|
|
|
Deferred income tax liabilities
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
|
|
—
|
|
|
|
3
|
|
|
Other liabilities
|
|
1
|
|
|
|
29
|
|
|
|
40
|
|
|
|
—
|
|
|
|
70
|
|
|
Total liabilities
|
|
1,655
|
|
|
|
731
|
|
|
|
1,883
|
|
|
|
(1,472
|
)
|
|
|
2,797
|
|
|
Total equity
|
|
2,441
|
|
|
|
4,368
|
|
|
|
1,431
|
|
|
|
(6,123
|
)
|
|
|
2,117
|
|
|
Total liabilities and equity
|
$
|
4,096
|
|
|
$
|
5,099
|
|
|
$
|
3,314
|
|
|
$
|
(7,595
|
)
|
|
$
|
4,914
|
|
|
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
|
||||||||||||||||||||
For the Year Ended December 31, 2015
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries |
Non-guarantor
Subsidiaries |
Consolidating
Adjustments |
Consolidated
|
|||||||||||||||
Net cash provided by (used in) operating activities
|
$
|
—
|
|
|
$
|
151
|
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
|
$
|
138
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash invested in fixed assets
|
|
—
|
|
|
|
(101
|
)
|
|
|
(84
|
)
|
|
|
—
|
|
|
|
(185
|
)
|
|
Acquisition of Atlas Paper, including cash overdraft acquired
|
|
—
|
|
|
|
(159
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(159
|
)
|
|
Increase in countervailing duties cash deposits
|
|
—
|
|
|
|
(4
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
Increase in deposit requirements for letters of credit, net
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
|
—
|
|
|
|
(4
|
)
|
|
Investment in common stock of subsidiary
|
|
—
|
|
|
|
(234
|
)
|
|
|
—
|
|
|
|
234
|
|
|
|
—
|
|
|
Advance to parent
|
|
—
|
|
|
|
(59
|
)
|
|
|
—
|
|
|
|
59
|
|
|
|
—
|
|
|
Decrease of notes receivable from affiliates
|
|
—
|
|
|
|
164
|
|
|
|
—
|
|
|
|
(164
|
)
|
|
|
—
|
|
|
Net cash used in investing activities
|
|
—
|
|
|
|
(393
|
)
|
|
|
(88
|
)
|
|
|
129
|
|
|
|
(352
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Payments of financing and credit facility fees
|
|
—
|
|
|
|
(2
|
)
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
(3
|
)
|
|
Purchases of treasury stock
|
|
(59
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(59
|
)
|
|
Issuance of common stock
|
|
—
|
|
|
|
—
|
|
|
|
234
|
|
|
|
(234
|
)
|
|
|
—
|
|
|
Advance to subsidiary
|
|
59
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(59
|
)
|
|
|
—
|
|
|
Decrease of notes payable to affiliate
|
|
—
|
|
|
|
—
|
|
|
|
(164
|
)
|
|
|
164
|
|
|
|
—
|
|
|
Net cash (used in) provided by financing activities
|
|
—
|
|
|
|
(2
|
)
|
|
|
69
|
|
|
|
(129
|
)
|
|
|
(62
|
)
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
—
|
|
|
|
—
|
|
|
|
(3
|
)
|
|
|
—
|
|
|
|
(3
|
)
|
|
Net decrease in cash and cash equivalents
|
|
—
|
|
|
|
(244
|
)
|
|
|
(35
|
)
|
|
|
—
|
|
|
|
(279
|
)
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Beginning of year
|
|
—
|
|
|
|
257
|
|
|
|
80
|
|
|
|
—
|
|
|
|
337
|
|
|
End of year
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
58
|
|
|
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
|
||||||||||||||||||||
For the Year Ended December 31, 2014
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries |
Non-guarantor
Subsidiaries |
Consolidating
Adjustments |
Consolidated
|
|||||||||||||||
Net cash provided by operating activities
|
$
|
—
|
|
|
$
|
144
|
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
186
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash invested in fixed assets
|
|
—
|
|
|
|
(76
|
)
|
|
|
(117
|
)
|
|
|
—
|
|
|
|
(193
|
)
|
|
Monetization of timber notes
|
|
—
|
|
|
|
22
|
|
|
|
—
|
|
|
|
—
|
|
|
|
22
|
|
|
Disposition of assets
|
|
—
|
|
|
|
4
|
|
|
|
6
|
|
|
|
—
|
|
|
|
10
|
|
|
Decrease in restricted cash
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
1
|
|
|
Decrease in deposit requirements for letters of credit, net
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
1
|
|
|
Other investing activities, net
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Net cash used in investing activities
|
|
—
|
|
|
|
(50
|
)
|
|
|
(111
|
)
|
|
|
—
|
|
|
|
(161
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividend to noncontrolling interest
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
|
—
|
|
|
|
(4
|
)
|
|
Payments of debt
|
|
—
|
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Payments of financing and credit facility fees
|
|
—
|
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(1
|
)
|
|
Net cash used in financing activities
|
|
—
|
|
|
|
(2
|
)
|
|
|
(5
|
)
|
|
|
—
|
|
|
|
(7
|
)
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
—
|
|
|
|
—
|
|
|
|
(3
|
)
|
|
|
—
|
|
|
|
(3
|
)
|
|
Net increase (decrease) in cash and cash equivalents
|
|
—
|
|
|
|
92
|
|
|
|
(77
|
)
|
|
|
—
|
|
|
|
15
|
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Beginning of year
|
|
—
|
|
|
|
165
|
|
|
|
157
|
|
|
|
—
|
|
|
|
322
|
|
|
End of year
|
$
|
—
|
|
|
$
|
257
|
|
|
$
|
80
|
|
|
$
|
—
|
|
|
$
|
337
|
|
|
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
|
||||||||||||||||||||
For the Year Ended December 31, 2013
|
||||||||||||||||||||
(In millions)
|
Parent
|
Guarantor
Subsidiaries |
Non-guarantor
Subsidiaries |
Consolidating
Adjustments |
Consolidated
|
|||||||||||||||
Net cash (used in) provided by operating activities
|
$
|
(5
|
)
|
|
$
|
41
|
|
|
$
|
170
|
|
|
$
|
—
|
|
|
$
|
206
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash invested in fixed assets
|
|
—
|
|
|
|
(55
|
)
|
|
|
(106
|
)
|
|
|
—
|
|
|
|
(161
|
)
|
|
Disposition of assets
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
|
—
|
|
|
|
4
|
|
|
Proceeds from insurance settlements
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
|
—
|
|
|
|
4
|
|
|
Decrease in restricted cash
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
|
|
—
|
|
|
|
8
|
|
|
Increase in deposit requirements for letters of credit, net
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Other investing activities, net
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
|
—
|
|
|
|
(4
|
)
|
|
Net cash used in investing activities
|
|
—
|
|
|
|
(55
|
)
|
|
|
(96
|
)
|
|
|
—
|
|
|
|
(151
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Issuance of long-term debt
|
|
594
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
594
|
|
|
Premium paid on extinguishment of debt
|
|
(84
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(84
|
)
|
|
Dividend to noncontrolling interest
|
|
—
|
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
Payments of debt
|
|
(501
|
)
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
(503
|
)
|
|
Payments of financing and credit facility fees
|
|
(9
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(9
|
)
|
|
Contribution of capital from noncontrolling interest
|
|
—
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
|
Net cash provided by (used in) financing activities
|
|
—
|
|
|
|
8
|
|
|
|
(4
|
)
|
|
|
—
|
|
|
|
4
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
(5
|
)
|
|
|
(6
|
)
|
|
|
70
|
|
|
|
—
|
|
|
|
59
|
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Beginning of year
|
|
5
|
|
|
|
171
|
|
|
|
87
|
|
|
|
—
|
|
|
|
263
|
|
|
End of year
|
$
|
—
|
|
|
$
|
165
|
|
|
$
|
157
|
|
|
$
|
—
|
|
|
$
|
322
|
|
|
Year ended December 31, 2015
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
Year
|
|||||||||||||||
(In millions, except per share amounts)
|
||||||||||||||||||||
Sales
|
$
|
920
|
|
|
$
|
926
|
|
|
$
|
905
|
|
|
$
|
894
|
|
|
$
|
3,645
|
|
|
Operating (loss) income
|
|
(15
|
)
|
|
|
16
|
|
|
|
6
|
|
|
|
(226
|
)
|
|
|
(219
|
)
|
|
Net loss attributable to Resolute Forest Products Inc.
|
|
(33
|
)
|
|
|
(4
|
)
|
|
|
(6
|
)
|
|
|
(214
|
)
|
|
|
(257
|
)
|
|
Basic net loss per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(0.35
|
)
|
|
|
(0.04
|
)
|
|
|
(0.07
|
)
|
|
|
(2.39
|
)
|
|
|
(2.78
|
)
|
|
Diluted net loss per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(0.35
|
)
|
|
|
(0.04
|
)
|
|
|
(0.07
|
)
|
|
|
(2.39
|
)
|
|
|
(2.78
|
)
|
|
Year ended December 31, 2014
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
Year
|
|||||||||||||||
(In millions, except per share amounts)
|
||||||||||||||||||||
Sales
|
$
|
1,016
|
|
|
$
|
1,091
|
|
|
$
|
1,096
|
|
|
$
|
1,055
|
|
|
$
|
4,258
|
|
|
Operating loss
|
|
(33
|
)
|
|
|
(8
|
)
|
|
|
(40
|
)
|
|
|
(93
|
)
|
|
|
(174
|
)
|
|
Net loss attributable to Resolute Forest Products Inc.
|
|
(50
|
)
|
|
|
(2
|
)
|
|
|
(116
|
)
|
|
|
(109
|
)
|
|
|
(277
|
)
|
|
Basic net loss per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(0.53
|
)
|
|
|
(0.02
|
)
|
|
|
(1.23
|
)
|
|
|
(1.15
|
)
|
|
|
(2.93
|
)
|
|
Diluted net loss per share attributable to Resolute Forest Products Inc. common shareholders
|
|
(0.53
|
)
|
|
|
(0.02
|
)
|
|
|
(1.23
|
)
|
|
|
(1.15
|
)
|
|
|
(2.93
|
)
|
|
/s/ PricewaterhouseCoopers LLP
(1)
|
Montreal, Canada
|
February 29, 2016
|
(1)
CPA auditor, CA, public accountancy permit No.A113048
|
—
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Resolute Forest Products Inc.;
|
|
|
—
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles;
|
|
|
—
|
provide reasonable assurance that receipts and expenditures of Resolute Forest Products Inc. are being made only in accordance with the authorizations of management and directors of Resolute Forest Products Inc.; and
|
|
|
—
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the consolidated financial statements.
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
(1)
|
The Resolute Forest Products Equity Incentive Plan was approved by the Courts pursuant to the Plans of Reorganization.
|
(2)
|
Includes shares issuable upon the exercise of
1,477,613
stock options and shares issuable upon the settlement of
1,534,480
restricted stock units and deferred stock units issued under the Resolute Forest Products Equity Incentive Plan, at a rate of one share per unit. Also includes shares issuable upon the settlement of
991,386
performance stock units issued under the Resolute Forest Products Equity Incentive Plan at the maximum payout rate (
1,398,829
shares).
|
(3)
|
The weighted-average exercise price in column (b) represents the weighted-average exercise price of the outstanding stock options disclosed in column (a). The deferred stock units, restricted stock units and performance stock units do not have an exercise price and are not included in the calculation of the weighted-average exercise price in column (b).
|
|
|
Page
|
|
Consolidated Statements of Operations for the Years Ended December 31, 2015, 2014 and 2013
|
|
|
Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2015, 2014 and 2013
|
|
|
Consolidated Balance Sheets as of December 31, 2015 and 2014
|
|
|
Consolidated Statements of Changes in Equity for the Years Ended December 31, 2015, 2014 and 2013
|
|
|
Consolidated Statements of Cash Flows for the Years Ended December 31, 2015, 2014 and 2013
|
|
|
||
|
||
|
Exhibit No.
|
Description
|
†10.4*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Director Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.3 to AbitibiBowater Inc.’s Registration Statement on Form S-8 filed January 7, 2011, SEC Registration No. 333-171602).
|
|
|
†10.5*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.4 to AbitibiBowater Inc.’s Registration Statement on Form S-8 filed January 7, 2011, SEC Registration No. 333-171602).
|
|
|
†10.6*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Restricted Stock Unit Agreement (incorporated by reference from Exhibit 10.13 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.7*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.14 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.8*
|
AbitibiBowater Executive Restricted Stock Unit Plan, effective as of April 1, 2011 (incorporated by reference from Exhibit 10.13 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.9*
|
Employment Agreement between Yves Laflamme and AbitibiBowater Inc., dated February 14, 2011 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Current Report on Form 8-K filed February 18, 2011, SEC File No. 001-33776).
|
|
|
†10.10*
|
Offer Letter between Jo-Ann Longworth and AbitibiBowater Inc., dated July 25, 2011 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011 filed November 14, 2011, SEC File No. 001-33776).
|
|
|
†10.11*
|
Offer Letter between Pierre Laberge and AbitibiBowater Inc., dated June 9, 2011 (incorporated by reference from Exhibit 10.35 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.12*
|
Director compensation program chart (incorporated by reference from Exhibit 10.36 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.13*
|
Retirement Compensation Trust Agreement (with Letter of Credit) between AbiBow Canada Inc. and AbitibiBowater Inc. and CIBC Mellon Trust Company, dated and effective as of November 1, 2011 (incorporated by reference from Exhibit 10.39 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
10.14*
|
Agreement Concerning the Pulp and Paper Operations of AbiBow Canada in Ontario, dated November 10, 2010, between Bowater Canadian Forest Products Inc. and Abitibi-Consolidated Company of Canada and The Province of Ontario (incorporated by reference from Exhibit 10.32 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
10.15*
|
Agreement Concerning the Pulp and Paper Operations of AbiBow Canada in Quebec, dated September 13, 2010, between Bowater Canadian Forest Products Inc. and Abitibi-Consolidated Company of Canada and The Government of Quebec (incorporated by reference from Exhibit 10.33 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.16*
|
Executive Employment Agreement between Resolute Forest Products Inc. and Richard Garneau, dated February 26, 2014 (incorporated by reference from Exhibit 10.24 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.17*
|
Change in Control Agreement between Resolute Forest Products Inc. and Richard Garneau, dated February 26, 2014 (incorporated by reference from Exhibit 10.25 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.18*
|
Offer Letter between John Lafave and AbitibiBowater Inc., dated February 14, 2011 (incorporated by reference from Exhibit 10.29 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.19*
|
Offer Letter between Jacques Vachon and AbitibiBowater Inc., dated March 19, 2012 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 filed May 10, 2012, SEC File No. 001-33776).
|
|
|
Exhibit No.
|
Description
|
†10.20*
|
Resolute Forest Products DC Make-up Program, effective January 1, 2012 (incorporated by reference from Exhibit 10.3 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 filed May 10, 2012, SEC File No. 001-33776).
|
|
|
†10.21*
|
Resolute Forest Products Inc. Severance Policy – Chief Executive Officer and Direct Reports, effective as of August 1, 2012 (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 filed August 9, 2012, SEC File No. 001-33776).
|
|
|
†10.22*
|
Resolute Forest Products Equity Incentive Plan (previously named the AbitibiBowater Inc. 2010 Equity Incentive Plan), effective as of December 9, 2010 (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 filed November 9, 2012, SEC File No. 001-33776).
|
|
|
†10.23*
|
Resolute Forest Products Outside Director Deferred Compensation Plan (previously named the AbitibiBowater Inc. Outside Director Deferred Compensation Plan), effective as of April 1, 2011 (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 filed November 9, 2012, SEC File No. 001-33776).
|
|
|
†10.24*
|
Form of Indemnification Agreement for Directors and Officers of Resolute Forest Products Inc. (incorporated by reference from Exhibit 10.41 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2012 filed March 1, 2013, SEC File No. 001-33776).
|
|
|
†10.25*
|
Resolute Forest Products Equity Incentive Plan Form of Director Deferred Stock Unit Agreement. (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
†10.26*
|
Resolute Forest Products Equity Incentive Plan Form of Director Restricted Stock Unit Agreement. (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
†10.27*
|
Resolute Forest Products Equity Incentive Plan Form of Restricted Stock Unit Agreement (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 filed November 10, 2014, SEC File No. 001-33776).
|
|
|
†10.28*
|
Resolute Forest Products Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.41to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.29*
|
Offer Letter between André Piché and Resolute Forest Products Inc., dated February 4, 2014 (incorporated by reference from Exhibit 10.42 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.30*
|
Offer Letter between Richard Tremblay and Resolute Forest Products Inc., dated February 4, 2014 (incorporated by reference from Exhibit 10.43 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.31*
|
Resolute Forest Products Equity Incentive Plan Form of Performance Stock Unit Agreement (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 filed November 10, 2014, SEC File No. 001-33776).
|
|
|
†10.32*
|
First Amendment dated February 14, 2014 to the AbitibiBowater 2010 Canadian DB Supplemental Executive Retirement Plan, effective as of December 9, 2010 (incorporated by reference from Exhibit 10.44 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
†10.33*
|
Resolute FP Canada Inc. and Resolute Forest Products Inc. Security Protocol with respect to the Resolute Forest Products 2010 Canadian DB Supplemental Executive Retirement Plan and the Resolute Canada SERP, amended and restated effective April 11, 2014. (incorporated by reference from Exhibit 10.45 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
†10.34*
|
Form of Indemnification Agreement for Directors and Officers of Resolute Forest Products Inc. (incorporated by reference from Exhibit 10.46 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
Exhibit No.
|
Description
|
10.35*
|
Credit Agreement, dated as of May 22, 2015, among Resolute Forest Products Inc., Resolute FP Canada Inc., certain other subsidiaries of Resolute Forest Products Inc. as borrowers or guarantors, various lenders, Bank of America, N.A., as U.S. Administrative Agent and Collateral Agent, and Bank of America, N.A. (through its Canada branch), as Canadian Administrative Agent (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Current Report on Form 8-K filed May 26, 2015, SEC file No. 001-033776).
|
|
|
†10.36*
|
2015 Resolute Forest Products Inc. Short-Term Incentive Plan (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 filed August 10, 2015, SEC File No. 001-33776).
|
|
|
†10.37*
|
2015 Resolute Forest Products Inc. Short-Term Incentive Plan - US (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 filed August 10, 2015, SEC File No. 001-33776).
|
|
|
†10.38*
|
Summary of 2016 Resolute Forest Products Inc. Short-Term Incentive Plan (incorporated by reference from the description in Resolute Forest Products Inc.’s Current Report on Form 8-K filed February 8, 2016, SEC File No. 001-33776).
|
|
|
†10.39**
|
Relocation Agreement between Richard Tremblay and Resolute Forest Products Inc., dated February 25, 2016.
|
|
|
21.1**
|
Subsidiaries of the registrant.
|
|
|
23.1**
|
Consent of PricewaterhouseCoopers LLP.
|
|
|
24.1**
|
Power of attorney for certain Directors of the registrant.
|
|
|
31.1**
|
Certification of President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2**
|
Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.1**
|
Certification of President and Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2**
|
Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101.INS***
|
XBRL Instance Document.
|
|
|
101.SCH***
|
XBRL Taxonomy Extension Schema Document.
|
|
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
*
|
Previously filed and incorporated herein by reference.
|
|
|
†
|
This is a management contract or compensatory plan or arrangement.
|
|
|
**
|
Filed with this Form 10-K.
|
|
|
***
|
Interactive data files furnished with this Form 10-K, which represent the following materials from this Form 10-K formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Loss, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statement of Changes in Equity, (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements.
|
|
|
(b)
|
The above-referenced exhibits are being filed with this Form 10-K.
|
|
|
(c)
|
None.
|
|
RESOLUTE FOREST PRODUCTS INC.
|
|
|
|
|
Date: February 29, 2016
|
By:
|
/s/ Richard Garneau
|
|
|
Richard Garneau
|
|
|
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Richard Garneau
|
|
President and Chief Executive Officer
|
|
February 29, 2016
|
Richard Garneau
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Bradley P. Martin*
|
|
Chairman, Director
|
|
February 29, 2016
|
Bradley P. Martin
|
|
|
|
|
|
|
|
|
|
/s/ Jo-Ann Longworth
|
|
Senior Vice President and Chief Financial Officer
|
|
February 29, 2016
|
Jo-Ann Longworth
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/ Silvana Travaglini
|
|
Vice President and Chief Accounting Officer
|
|
February 29, 2016
|
Silvana Travaglini
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ Michel P. Desbiens*
|
|
Director
|
|
February 29, 2016
|
Michel P. Desbiens
|
|
|
|
|
|
|
|
|
|
/s/ Jennifer C. Dolan*
|
|
Director
|
|
February 29, 2016
|
Jennifer C. Dolan
|
|
|
|
|
|
|
|
|
|
/s/ Richard D. Falconer*
|
|
Director
|
|
February 29, 2016
|
Richard D. Falconer
|
|
|
|
|
|
|
|
|
|
/s/ Jeffrey A. Hearn*
|
|
Director
|
|
February 29, 2016
|
Jeffrey A. Hearn
|
|
|
|
|
|
|
|
|
|
/s/ Alain Rhéaume*
|
|
Director
|
|
February 29, 2016
|
Alain Rhéaume
|
|
|
|
|
|
|
|
|
|
/s/ Michael S. Rousseau*
|
|
Director
|
|
February 29, 2016
|
Michael S. Rousseau
|
|
|
|
|
|
|
|
|
|
/s/ David H. Wilkins*
|
|
Director
|
|
February 29, 2016
|
David H. Wilkins
|
|
|
|
|
|
By:
|
/s/ Jo-Ann Longworth
|
|
|
Jo-Ann Longworth, Attorney-in-Fact
|
Exhibit No.
|
Description
|
|
|
2.1*
|
Share Purchase Agreement, dated December 10, 2012, among The Province of Nova Scotia, Bowater Canadian Limited, The Daily Herald Company and Resolute Forest Products Inc. (incorporated by reference from Exhibit 2.1 to Resolute Forest Products Inc.’s Current Report on Form 8-K filed December 14, 2012, SEC File No. 001-33776).
|
|
|
3.1*
|
Amended and Restated Certificate of Incorporation of Resolute Forest Product Inc. (incorporated by reference from Exhibit 3.1 to Resolute Forest Product Inc.’s Annual Report on Form 10-K for the year ended December 31, 2012 filed March 1, 2013, SEC File No. 001-33776).
|
|
|
3.2*
|
By-laws of Resolute Forest Products Inc., as amended through December 4, 2014 (incorporated by reference from Exhibit 3.1 to Resolute Forest Products Inc.’s Current Report on Form 8-K filed on December 10, 2014).
|
|
|
4.1*
|
Indenture, dated as of May 8, 2013, among Resolute Forest Products Inc., the guarantors party thereto and Wells Fargo Bank, National Association, as trustee. (incorporated by reference from Exhibit 4.4 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
4.2*
|
Registration Rights Agreement, dated as of May 8, 2013, among Resolute Forest Products Inc., the guarantors party thereto and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative. (incorporated by reference from Exhibit 4.5 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
10.1*
|
Securities Purchase Agreement, dated February 11, 2011, among AbiBow Canada Inc., Caisse de dépôt et placement du Québec and CDP Investissements Inc., as vendors, and Infra H2O GP Partners Inc., Infra H2O LP Partners Inc. and BluEarth Renewables Inc., as the purchaser (incorporated by reference from Exhibit 2.1 to AbitibiBowater Inc.’s Current Report on Form 8-K filed February 17, 2011, SEC File No. 001-33776).
|
|
|
†10.2*
|
AbitibiBowater 2010 Canadian DB Supplemental Executive Retirement Plan, effective as of December 9, 2010 (incorporated by reference from Exhibit 10.4 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.3*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Restricted Stock Unit Agreement (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Registration Statement on Form S-8 filed January 7, 2011, SEC Registration No. 333-171602).
|
|
|
†10.4*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Director Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.3 to AbitibiBowater Inc.’s Registration Statement on Form S-8 filed January 7, 2011, SEC Registration No. 333-171602).
|
|
|
†10.5*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.4 to AbitibiBowater Inc.’s Registration Statement on Form S-8 filed January 7, 2011, SEC Registration No. 333-171602).
|
|
|
†10.6*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Restricted Stock Unit Agreement (incorporated by reference from Exhibit 10.13 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.7*
|
AbitibiBowater Inc. 2010 Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.14 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.8*
|
AbitibiBowater Executive Restricted Stock Unit Plan, effective as of April 1, 2011 (incorporated by reference from Exhibit 10.13 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.9*
|
Employment Agreement between Yves Laflamme and AbitibiBowater Inc., dated February 14, 2011 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Current Report on Form 8-K filed February 18, 2011, SEC File No. 001-33776).
|
|
|
†10.10*
|
Offer Letter between Jo-Ann Longworth and AbitibiBowater Inc., dated July 25, 2011 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011 filed November 14, 2011, SEC File No. 001-33776).
|
|
|
†10.11*
|
Offer Letter between Pierre Laberge and AbitibiBowater Inc., dated June 9, 2011 (incorporated by reference from Exhibit 10.35 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
Exhibit No.
|
Description
|
†10.12*
|
Director compensation program chart (incorporated by reference from Exhibit 10.36 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
†10.13*
|
Retirement Compensation Trust Agreement (with Letter of Credit) between AbiBow Canada Inc. and AbitibiBowater Inc. and CIBC Mellon Trust Company, dated and effective as of November 1, 2011 (incorporated by reference from Exhibit 10.39 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011 filed February 29, 2012, SEC File No. 001-33776).
|
|
|
10.14*
|
Agreement Concerning the Pulp and Paper Operations of AbiBow Canada in Ontario, dated November 10, 2010, between Bowater Canadian Forest Products Inc. and Abitibi-Consolidated Company of Canada and The Province of Ontario (incorporated by reference from Exhibit 10.32 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
10.15*
|
Agreement Concerning the Pulp and Paper Operations of AbiBow Canada in Quebec, dated September 13, 2010, between Bowater Canadian Forest Products Inc. and Abitibi-Consolidated Company of Canada and The Government of Quebec (incorporated by reference from Exhibit 10.33 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.16*
|
Executive Employment Agreement between Resolute Forest Products Inc. and Richard Garneau, dated February 26, 2014 (incorporated by reference from Exhibit 10.24 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.17*
|
Change in Control Agreement between Resolute Forest Products Inc. and Richard Garneau, dated February 26, 2014 (incorporated by reference from Exhibit 10.25 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.18*
|
Offer Letter between John Lafave and AbitibiBowater Inc., dated February 14, 2011 (incorporated by reference from Exhibit 10.29 to AbitibiBowater Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010 filed April 5, 2011, SEC File No. 001-33776).
|
|
|
†10.19*
|
Offer Letter between Jacques Vachon and AbitibiBowater Inc., dated March 19, 2012 (incorporated by reference from Exhibit 10.2 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 filed May 10, 2012, SEC File No. 001-33776).
|
|
|
†10.20*
|
Resolute Forest Products DC Make-up Program, effective January 1, 2012 (incorporated by reference from Exhibit 10.3 to AbitibiBowater Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 filed May 10, 2012, SEC File No. 001-33776).
|
|
|
†10.21*
|
Resolute Forest Products Inc. Severance Policy – Chief Executive Officer and Direct Reports, effective as of August 1, 2012 (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 filed August 9, 2012, SEC File No. 001-33776).
|
|
|
†10.22*
|
Resolute Forest Products Equity Incentive Plan (previously named the AbitibiBowater Inc. 2010 Equity Incentive Plan), effective as of December 9, 2010 (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 filed November 9, 2012, SEC File No. 001-33776).
|
|
|
†10.23*
|
Resolute Forest Products Outside Director Deferred Compensation Plan (previously named the AbitibiBowater Inc. Outside Director Deferred Compensation Plan), effective as of April 1, 2011 (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 filed November 9, 2012, SEC File No. 001-33776).
|
|
|
†10.24*
|
Form of Indemnification Agreement for Directors and Officers of Resolute Forest Products Inc. (incorporated by reference from Exhibit 10.41 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2012 filed March 1, 2013, SEC File No. 001-33776).
|
|
|
†10.25*
|
Resolute Forest Products Equity Incentive Plan Form of Director Deferred Stock Unit Agreement. (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
†10.26*
|
Resolute Forest Products Equity Incentive Plan Form of Director Restricted Stock Unit Agreement. (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013 filed May 10, 2013, SEC File No. 001-33776).
|
|
|
†10.27*
|
Resolute Forest Products Equity Incentive Plan Form of Restricted Stock Unit Agreement (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 filed November 10, 2014, SEC File No. 001-33776).
|
|
|
†10.28*
|
Resolute Forest Products Equity Incentive Plan Form of Employee Nonqualified Stock Option Agreement (incorporated by reference from Exhibit 10.41to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
Exhibit No.
|
Description
|
|
|
†10.29*
|
Offer Letter between André Piché and Resolute Forest Products Inc., dated February 4, 2014 (incorporated by reference from Exhibit 10.42 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.30*
|
Offer Letter between Richard Tremblay and Resolute Forest Products Inc., dated February 4, 2014 (incorporated by reference from Exhibit 10.43 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2013 filed March 3, 2014, SEC File No. 001-33776).
|
|
|
†10.31*
|
Resolute Forest Products Equity Incentive Plan Form of Performance Stock Unit Agreement (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 filed November 10, 2014, SEC File No. 001-33776).
|
|
|
†10.32*
|
First Amendment dated February 14, 2014 to the AbitibiBowater 2010 Canadian DB Supplemental Executive Retirement Plan, effective as of December 9, 2010 (incorporated by reference from Exhibit 10.44 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
†10.33*
|
Resolute FP Canada Inc. and Resolute Forest Products Inc. Security Protocol with respect to the Resolute Forest Products 2010 Canadian DB Supplemental Executive Retirement Plan and the Resolute Canada SERP, amended and restated effective April 11, 2014. (incorporated by reference from Exhibit 10.45 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
†10.34*
|
Form of Indemnification Agreement for Directors and Officers of Resolute Forest Products Inc. (incorporated by reference from Exhibit 10.46 to Resolute Forest Products Inc.’s Annual Report on Form 10-K for the year ended December 31, 2014 filed March 2, 2015, SEC File No. 001-33776).
|
|
|
10.35*
|
Credit Agreement, dated as of May 22, 2015, among Resolute Forest Products Inc., Resolute FP Canada Inc., certain other subsidiaries of Resolute Forest Products Inc. as borrowers or guarantors, various lenders, Bank of America, N.A., as U.S. Administrative Agent and Collateral Agent, and Bank of America, N.A. (through its Canada branch), as Canadian Administrative Agent (incorporated by reference from Exhibit 10.1 to Resolute Forest Products Inc.’s Current Report on Form 8-K filed May 26, 2015, SEC file No. 001-033776).
|
|
|
†10.36*
|
2015 Resolute Forest Products Inc. Short-Term Incentive Plan (incorporated by reference from Exhibit 10.2 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 filed August 10, 2015, SEC File No. 001-33776).
|
|
|
†10.37*
|
2015 Resolute Forest Products Inc. Short-Term Incentive Plan - US (incorporated by reference from Exhibit 10.3 to Resolute Forest Products Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 filed August 10, 2015, SEC File No. 001-33776).
|
|
|
†10.38*
|
Summary of 2016 Resolute Forest Products Inc. Short-Term Incentive Plan (incorporated by reference from the description in Resolute Forest Products Inc.’s Current Report on Form 8-K filed February 8, 2016, SEC File No. 001-33776).
|
|
|
†10.39**
|
Relocation Agreement between Richard Tremblay and Resolute Forest Products Inc., dated February 25, 2016.
|
|
|
21.1**
|
Subsidiaries of the registrant.
|
|
|
23.1**
|
Consent of PricewaterhouseCoopers LLP.
|
|
|
24.1**
|
Power of attorney for certain Directors of the registrant.
|
|
|
31.1**
|
Certification of President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2**
|
Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.1**
|
Certification of President and Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2**
|
Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101.INS***
|
XBRL Instance Document.
|
|
|
101.SCH***
|
XBRL Taxonomy Extension Schema Document.
|
|
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
Exhibit No.
|
Description
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
*
|
Previously filed and incorporated herein by reference.
|
|
|
†
|
This is a management contract or compensatory plan or arrangement.
|
|
|
**
|
Filed with this Form 10-K.
|
|
|
***
|
Interactive data files furnished with this Form 10-K, which represent the following materials from this Form 10-K formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Loss, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statement of Changes in Equity, (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements.
|
|
|
(b)
|
The above-referenced exhibits are being filed with this Form 10-K.
|
|
|
(c)
|
None.
|
▪
|
I will be required to reimburse the Company for a prorated portion of the Standard Relocation Benefits I have received from the Company, based on 24 months less the number of months worked (remaining to 24 months), divided by 24 months.
|
▪
|
For example, if I leave in the 7th month after my relocation, and therefore have only worked a full 6 months, the calculation will be (24-6)/24 = 75.00%.
|
▪
|
In addition to the Standard Relocation Benefits, I acknowledge that the Company has undertaken to compensate me in an amount $150,000, net of applicable taxes, for the equity loss on the sale of my property in Virginia (the “Equity Loss Payment”). I acknowledge that I will be required to reimburse the Company the full value of this payment (i.e. the gross amount paid by the Company on a pre-tax basis) if my employment with the Company terminates within twenty four (24) months or before my relocation as the result of either my voluntary termination or my involuntary termination for cause.
|
▪
|
The Company shall, to the extent permitted by applicable laws, reduce any compensation otherwise due to me upon my termination of employment, including but not limited to regular wages, severance pay and bonuses, by the amount of Standard Relocation Benefits and the Equity Loss Payment that I am required to reimburse the Company for under the terms of the Guide.
|
Name
|
Jurisdiction of Incorporation
|
3284649 Nova Scotia Company
|
Nova Scotia
|
9192-8515 Québec Inc.
(1)
|
Québec
|
9340939 Canada Inc.
|
Canada
|
9340963 Canada Inc.
|
Canada
|
AbiBow Recycling LLC
|
Delaware
|
Abitibi Consolidated Europe
|
Belgium
|
Abitibi Consolidated Sales LLC
|
Delaware
|
AbitibiBowater Canada Inc.
|
Canada
|
Accurate Paper Fleet, LLC
|
Delaware
|
Accurate Paper Holdings, LLC
|
Delaware
|
Atlas Paper Management, LLC
|
Delaware
|
Atlas Paper Mills, LLC
|
Delaware
|
Atlas Southeast Papers, Inc.
|
Delaware
|
Atlas Tissue Holdings, Inc.
|
Delaware
|
Augusta Newsprint Holding LLC
|
Delaware
|
Bowater Asia Pte. Ltd.
|
Singapore
|
Bowater Canada Finance Corporation
|
Nova Scotia
|
Bowater Canadian Holdings Incorporated
|
Nova Scotia
|
Bowater Canadian Limited
|
Canada
|
Bowater LaHave Corporation
|
Nova Scotia
|
Bowater Newsprint South LLC
|
Delaware
|
Bowater Nuway Mid-States Inc.
|
Delaware
|
Bowater S. America Ltda.
|
Brazil
|
Bowater South American Holdings Incorporated
|
Delaware
|
Bowater-Korea Ltd.
|
Korea
|
Calhoun Newsprint Company
|
Delaware
|
Calhoun Note Holdings AT LLC
|
Delaware
|
Calhoun Note Holdings TI LLC
|
Delaware
|
Donohue Corp.
|
Delaware
|
Donohue Malbaie Inc.
(2)
|
Québec
|
FD Powerco LLC
|
West Virginia
|
Fibrek Canada L.P.
|
Québec
|
Fibrek Canada ULC
|
Nova Scotia
|
Fibrek General Partnership
|
Québec
|
Fibrek International Inc.
|
Canada
|
Fibrek Recycling U.S. Inc.
|
Delaware
|
Fibrek U.S. Inc.
|
Delaware
|
Forest Products Mauricie L.P.
(1)
|
Québec
|
GLPC Residual Management, LLC
|
Delaware
|
Lake Superior Forest Products Inc.
|
Delaware
|
Resolute FP Augusta LLC
|
Delaware
|
Resolute FP Canada Inc.
|
Canada
|
Resolute FP Florida Inc.
|
Delaware
|
Resolute FP US Inc.
|
Delaware
|
Resolute Growth Canada Inc.
|
Canada
|
Resolute Growth US LLC
|
Delaware
|
RFPG Holding Inc.
|
Canada
|
RFPG L.P.
|
Québec
|
SFK Pulp Finco Inc.
|
Canada
|
The International Bridge and Terminal Company
|
Canada/Special Act
|
(1)
|
93.2 percent owned.
|
(2)
|
51 percent owned.
|
/s/ Bradley P. Martin
|
|
/s/ Jeffrey A. Hearn
|
Bradley P. Martin
Chairman of the Board |
|
Jeffrey A. Hearn
Director |
|
|
|
/s/ Michel P. Desbiens
|
|
/s/ Alain Rhéaume
|
Michel P. Desbiens
Director |
|
Alain Rhéaume
Director |
|
|
|
/s/ Jennifer C. Dolan
|
|
/s/ Michael S. Rousseau
|
Jennifer C. Dolan
Director |
|
Michael S. Rousseau
Director |
|
|
|
/s/ Richard D. Falconer
|
|
/s/ David H. Wilkins
|
Richard D. Falconer
Director |
|
David H. Wilkins
Director |
1.
|
I have reviewed this annual report on Form 10-K for the year ended
December 31, 2015
of RESOLUTE FOREST PRODUCTS INC.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 29, 2016
|
|
/s/ Richard Garneau
|
|
Richard Garneau
President and Chief Executive Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K for the year ended
December 31, 2015
of RESOLUTE FOREST PRODUCTS INC.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 29, 2016
|
|
/s/ Jo-Ann Longworth
|
|
Jo-Ann Longworth
Senior Vice President and Chief Financial Officer
|
|
February 29, 2016
|
|
/s/ Richard Garneau
|
|
|
Name: Richard Garneau
Title: President and Chief Executive Officer
|
February 29, 2016
|
|
/s/ Jo-Ann Longworth
|
|
|
Name: Jo-Ann Longworth
Title: Senior Vice President and Chief Financial Officer
|