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Segment Information
 12 Months Ended
Dec. 31, 2014
Segment Reporting [Abstract]  
Segment Information
Segment Information

On October 25, 2013, PCA acquired Boise Inc. (Boise) for $2.1 billion, including the fair value of assumed debt. After the acquisition, we began reporting in three reportable segments: Packaging, Paper, and Corporate and Other. These segments represent distinct businesses that are managed separately because of differing products and services. Each of these businesses requires distinct operating and marketing strategies.

Packaging. We manufacture and sell a wide variety of corrugated packaging products, including conventional shipping containers used to protect and transport manufactured goods, multi-color boxes and displays with strong visual appeal that help to merchandise the packaged product in retail locations. In addition, we are a large producer of packaging for meat, fresh fruit and vegetables, processed food, beverages, and other industrial and consumer products.

Paper. We manufacture and sell a range of white papers, including communication papers, and pressure sensitive papers, and market pulp. Our white papers can be manufactured as either commodity papers or specialty papers with specialized or custom features, such as colors, coatings, high brightness, or recycled content. We ship to customers both directly from our mills and through distribution centers. In 2014, our sales to Office Depot (including OfficeMax), our largest paper segment customer, represented 44% of our Paper segment sales revenue.

Corporate and Other. Our Corporate and Other segment includes corporate support staff services and related assets and liabilities, and foreign exchange gains and losses. This segment also includes transportation assets, such as rail cars and trucks, which we use to transport our products from some of our manufacturing sites and assets related to a 50% owned variable interest entity, Louisiana Timber Procurement Company, L.L.C. (LTP), that we acquired in the acquisition of Boise. See Note 16, Transactions With Related Parties, for more information related to LTP. Sales in this segment relate primarily to LTP and our rail and truck business. We provide transportation services not only to our own facilities but also, on a limited basis, to third parties when geographic proximity and logistics are favorable. Rail cars and trucks are generally leased.

Each segments' profits and losses are measured on operating profits before interest expense and interest income. For many of these allocated expenses, the related assets and liabilities remain in the Corporate and Other segment.

Segment sales to external customers by product line were as follows (dollars in millions):
 
Year Ended December 31
2014
 
2013
 
2012
 
 
 
 
 
 
Packaging sales
$
4,540.3

 
$
3,431.7

 
$
2,843.9

 
 
 
 
 
 
Paper sales
 
 
 
 
 
White papers
1,138.5

 
207.0

 
—

Market pulp
62.9

 
9.9

 
—

 
1,201.4

 
216.9

 
—

 
 
 
 
 
 
Corporate and Other
110.9

 
16.7

 
—

 
$
5,852.6

 
$
3,665.3

 
$
2,843.9



Sales to foreign unaffiliated customers during the years ended December 31, 2014, 2013, and 2012 were $378.8 million, $162.4 million, and $115.8 million, respectively. At December 31, 2014 and 2013, the net carrying value of long-lived assets held by foreign operations, all of which were in our Packaging segment, were $12.4 million and $14.0 million, respectively.

An analysis of operations by reportable segment were as follows (dollars in millions):
 
 
Sales, net
 
Operating Income (Loss)
 
Depreciation,
Amortization, and Depletion
 
Capital
Expenditures (l)
 
Assets
Year Ended December 31, 2014
 
Trade
 
Inter-
segment
 
Total
 
 
 
 
Packaging
 
$
4,534.5

 
$
5.8

 
$
4,540.3

 
$
663.2

(b)
$
323.0

 
$
362.1

 
$
4,105.3

Paper
 
1,201.4

 
—

 
1,201.4

 
135.4

 
50.6

 
51.7

 
968.6

Corporate and Other
 
116.7

 
144.9

 
261.6

 
(95.9
)
(c)
7.4

 
6.4

 
274.6

Intersegment eliminations
 
—

 
(150.7
)
 
(150.7
)
 
—

 
—

 
—

 
—

 
 
$
5,852.6

 
$
—

 
$
5,852.6

 
702.7

 
$
381.0

 
$
420.2

 
$
5,348.5

Interest expense, net
 
 
 
 
 
 
 
(88.4
)
(d)
 
 
 
 
 
Income before taxes
 
 
 
 
 
 
 
$
614.3

 
 
 
 
 
 
 
 
Sales, net
 
Operating Income (Loss)
 
Depreciation,
Amortization, and Depletion
 
Capital
Expenditures (l)
 
Assets
Year Ended December 31, 2013 (a)
 
Trade
 
Inter-
segment
 
Total
 
 
 
 
Packaging
 
$
3,431.3

 
$
0.4

 
$
3,431.7

 
$
554.2

(e)
$
190.2

 
$
222.2

 
$
3,988.5

Paper
 
216.9

 
—

 
216.9

 
13.5

(f)
9.1

 
10.0

 
938.4

Corporate and Other
 
17.1

 
28.0

 
45.1

 
(85.8
)
(g)
2.5

 
2.2

 
316.9

Intersegment eliminations
 
—

 
(28.4
)
 
(28.4
)
 
—

 
—

 
—

 
—

 
 
$
3,665.3

 
$
—

 
$
3,665.3

 
481.9

 
$
201.8

 
$
234.4

 
$
5,243.8

Interest expense, net
 
 
 
 
 
 
 
(58.3
)
(h)
 
 
 
 
 
Income before taxes
 
 
 
 
 
 
 
$
423.6

 
 
 
 
 
 
 
 
Sales, net
 
Operating Income (Loss)
 
Depreciation,
Amortization, and Depletion
 
Capital
Expenditures (l)
 
Assets
Year Ended December 31, 2012
 
Trade
 
Inter-
segment
 
Total
 
 
 
 
Packaging
 
$
2,843.9

 
$
—

 
$
2,843.9

 
$
383.9

(i)
$
169.4

 
$
127.8

 
$
2,194.5

Corporate and Other
 
—

 
—

 
—

 
53.7

(j)
1.4

 
0.7

 
300.4

 
 
$
2,843.9

 
$
—

 
$
2,843.9

 
437.6

 
$
170.8

 
$
128.5

 
$
2,494.9

Interest expense, net
 
 
 
 
 
 
 
(62.9
)
(k)
 
 
 
 
 
Income before taxes
 
 
 
 
 
 
 
$
374.7

 
 
 
 
 
 

____________
(a)
On October 25, 2013, we acquired Boise Inc. (Boise). Our financial results include Boise subsequent to acquisition.
(b)
Includes $65.8 million of costs related primarily to the conversion of the No. 3 newsprint machine at our DeRidder, Louisiana, mill to produce lightweight linerboard and corrugating medium, and our exit from the newsprint business in September 2014. Includes $4.9 million of Boise acquisition integration-related and other costs, most of which are recorded in "Other expense, net".
(c)
Includes $13.5 million of Boise acquisition integration-related and other costs, most of which are recorded in "Other expense, net". Includes $17.6 million of costs for the settlement of the Kleen Products LLC v Packaging Corp. of America et al class action lawsuit recorded in "Other expense, net". See Note 20, Commitments, Guarantees, Indemnifications, and Legal Proceedings, for more information.
(d)
Includes $1.5 million of expense related to the write-off of deferred financing costs in connection with the debt refinancing discussed in Note 10, Debt.
(e)
Includes $18.0 million of expense for the acquisition inventory step-up and $1.4 million of integration-related and other costs incurred in connection with the acquisition of Boise in fourth quarter 2013.
(f)
Includes $3.5 million of expense for acquisition inventory step-up and $1.9 million of income for integration-related and other costs.
(g)
Includes $17.2 million of acquisition-related costs and $17.9 million of integration-related and other costs.
(h)
Includes $10.5 million of expenses for financing the acquisition and $1.1 million of expense for the write-off of deferred financing costs.
(i)
Includes $2.0 million of plant closure charges.
(j)
Includes $95.5 million of income related to the increase in gallons claimed as alternative energy tax credits on the Company's amended 2009 tax return. See Note 7, Alternative Energy Tax Credits, for more information.
(k)
Includes $24.8 million of debt refinancing charges, including a $21.3 million redemption premium, a $3.4 million charge to settle the treasury lock prior to its maturity, and $0.1 million of other items.
(l)
Includes "Additions to property, plant, and equipment" and excludes cash used for "Acquisitions of businesses, net of cash acquired" as reported on our Consolidated Statements of Cash Flows.