International Paper 8-K Report, Exit or Disposal Costs (Feb 13, 2025)

On February 11, 2025, International Paper Company committed to actions affecting its North American Packaging Solutions business, with estimated aggregate pre-tax charges of approximately $357 million^a.

The largest component is the planned permanent closure of its containerboard mill in Campti, Louisiana, which the Company expects to reduce containerboard capacity by approximately 814,000 tons annualized. The charges comprise a pre-tax noncash asset write-off of approximately $311 million^b, of which $276 million is accelerated depreciation, and pre-tax cash severance and other shutdown charges of approximately $46 million. The Company expects these charges to be recorded in the three months ending March 31, 2025, and the mill closure is expected to reduce its workforce by approximately 481 employees.

A press release issued February 13, 2025 (Exhibit 99.1) broadens the closures to include the Red River containerboard mill in Campti, a recycling plant in Phoenix, Arizona, a box plant in Hazleton, Pennsylvania, and a sheet feeder facility in St. Louis, Missouri. It describes the Red River closure as reducing containerboard capacity by approximately 800,000 tons on an annualized basis, and states that 495 hourly and 179 salaried employees will be affected. The release says all facilities will cease operations by the end of April 2025, while the Form 8-K states that mill manufacturing operations are expected to cease by March 31, 2025.

The Company states it will use attrition, retirements and current vacancies at other locations to minimize employee impact, and that the actions are a step in its transformation into a stronger sustainable packaging solutions company focused on investments that best serve customers. The filing's forward-looking statements caution that the amount and timing of the charges, and the anticipated benefits of the closures, could differ materially from current expectations.