XML 74 R20.htm IDEA: XBRL DOCUMENT v3.2.0.727
Concentrations of Risk
6 Months Ended
Jun. 30, 2015
Risks and Uncertainties [Abstract]  
Concentration of Risk
Concentrations of Risk

Our Paper segment has had a long-standing commercial and contractual relationship with OfficeMax Incorporated (OfficeMax), and OfficeMax is our largest customer in the paper business. OfficeMax was acquired by Office Depot, Inc. late in 2013. Office Depot agreed to be acquired by Staples, Inc. on February 4, 2015. The pending acquisition by Staples is subject to the satisfaction of certain conditions. This relationship exposes us to a significant concentration of business and financial risk. Our sales to Office Depot (including OfficeMax) represent approximately 10% of our total company sales revenue and approximately 45% of our Paper segment sales revenue. At June 30, 2015, and December 31, 2014, we had $64.3 million and $52.6 million of accounts receivable due from Office Depot (including OfficeMax), which represented 9% and 8% of our total company receivables, respectively.

We cannot predict how the pending merger between Staples and Office Depot will affect our business. Significant increases in paper purchases would intensify the concentration of risk. Significant reductions in paper purchases would cause our paper business to expand its customer base and could potentially decrease its profitability if new customer sales required either a decrease in pricing and/or an increase in cost of sales. Any significant deterioration in the financial condition of the post-merger entity affecting its ability to pay or causing a significant change in the willingness to continue to purchase our products could harm our business and results of operations.