WESTROCK CO, 10-Q filed on 8/9/2016
Quarterly Report
Document and Entity Information Document
9 Months Ended
Jun. 30, 2016
Jul. 29, 2016
Entity Information [Line Items]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Jun. 30, 2016 
 
Document Fiscal Year Focus
2016 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
WRK 
 
Entity Registrant Name
WestRock CO 
 
Entity Central Index Key
0001636023 
 
Current Fiscal Year End Date
--09-30 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
251,494,672 
Condensed Consolidated Statements of Income (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Net sales
$ 3,596.5 
$ 2,538.9 
$ 10,560.1 
$ 7,508.7 
Cost of goods sold
2,869.2 
2,012.6 
8,520.8 
6,055.8 
Gross profit
727.3 
526.3 
2,039.3 
1,452.9 
Selling, general and administrative, excluding intangible amortization
341.5 
224.7 
1,019.4 
676.5 
Selling, general and administrative intangible amortization
53.3 
22.1 
159.4 
66.6 
Pension lump sum settlement and retiree medical curtailment, net
0 
(0.4)
0 
11.5 
Restructuring and other costs, net
43.1 
13.1 
317.0 
35.7 
Operating profit
289.4 
266.8 
543.5 
662.6 
Interest expense
(64.0)
(22.6)
(193.2)
(68.9)
Interest income and other income (expense), net
20.9 
(0.7)
43.2 
(1.0)
Equity in income of unconsolidated entities
5.8 
2.7 
6.8 
7.3 
Income from continuing operations before income taxes
252.1 
246.2 
400.3 
600.0 
Income tax expense
(99.7)
(88.3)
(159.1)
(206.1)
Income from continuing operations
152.4 
157.9 
241.2 
393.9 
Loss from discontinued operations (net of income tax benefit of $46.2, $0, $39.0 and $0)
(58.7)
0 
(539.4)
0 
Consolidated net income (loss)
93.7 
157.9 
(298.2)
393.9 
Less: Net income attributable to noncontrolling interests
(1.4)
(1.5)
(6.1)
(2.6)
Net income (loss) attributable to common stockholders
$ 92.3 
$ 156.4 
$ (304.3)
$ 391.3 
Basic earnings per share from continuing operations
$ 0.60 
$ 1.11 
$ 0.94 
$ 2.78 
Basic loss per share from discontinued operations
$ (0.23)
$ 0.00 
$ (2.13)
$ 0.00 
Basic earnings (loss) per share attributable to common stockholders
$ 0.37 
$ 1.11 
$ (1.19)
$ 2.78 
Diluted earnings per share from continuing operations
$ 0.59 
$ 1.10 
$ 0.93 
$ 2.74 
Diluted loss per share from discontinued operations
$ (0.23)
$ 0.00 
$ (2.11)
$ 0.00 
Diluted earnings (loss) per share attributable to common stockholders
$ 0.36 
$ 1.10 
$ (1.18)
$ 2.74 
Cash dividends paid per share
$ 0.375 
$ 0.3205 
$ 1.125 
$ 0.8286 
Condensed Consolidated Statements of Income (Parentheticals) (Parentheticals) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Income tax benefit, discontinued operations
$ 46.2 
$ 0 
$ 39.0 
$ 0 
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Consolidated net income (loss)
$ 93.7 
$ 157.9 
$ (298.2)
$ 393.9 
Foreign currency:
 
 
 
 
Foreign currency translation gain (loss)
35.6 
2.2 
133.3 
(45.0)
Reclassification adjustment of net loss on foreign currency translation included in earnings
(20.2)
0 
(20.2)
0 
Derivatives:
 
 
 
 
Deferred gain (loss) on cash flow hedges
0.1 
0 
(0.5)
0 
Reclassification adjustment of net loss on cash flow hedges included in earnings
0.4 
0 
1.0 
0 
Defined benefit pension plans:
 
 
 
 
Net actuarial (loss) gain arising during the period
0 
(0.5)
1.4 
(3.3)
Amortization and settlement recognition of net actuarial loss, included in pension cost
1.5 
6.3 
4.9 
29.1 
Prior service credit (cost) arising during the period
0 
0.7 
0 
(13.2)
Amortization and curtailment recognition of prior service cost (credit), included in pension cost
0.2 
0 
0.8 
(4.9)
Other comprehensive income (loss)
58.0 
8.7 
161.1 
(37.3)
Comprehensive income (loss)
151.7 
166.6 
(137.1)
356.6 
Less: Comprehensive income attributable to noncontrolling interests
(1.5)
(1.7)
(6.3)
(2.6)
Comprehensive income (loss) attributable to common stockholders
$ 150.2 
$ 164.9 
$ (143.4)
$ 354.0 
Condensed Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Jun. 30, 2016
Sep. 30, 2015
Current assets:
 
 
Cash and cash equivalents
$ 258.7 
$ 207.8 
Restricted cash
7.3 
7.3 
Accounts receivable (net of allowances of $38.5 and $29.5)
1,596.6 
1,575.4 
Inventories
1,691.1 
1,761.0 
Other current assets
331.5 
261.7 
Current assets of discontinued operations
0 
362.8 
Total current assets
3,885.2 
4,176.0 
Property, plant and equipment, net
9,345.2 
9,159.8 
Goodwill
4,788.0 
4,647.1 
Intangibles, net
2,651.3 
2,794.9 
Restricted assets held by special purpose entities
1,295.4 
1,302.1 
Prepaid pension asset
545.1 
532.9 
Other assets
936.2 
503.9 
Long-term assets of discontinued operations
0 
2,255.7 
Assets
23,446.4 
25,372.4 
Current liabilities:
 
 
Current portion of debt
345.2 
63.7 
Accounts payable
1,109.5 
1,231.4 
Accrued compensation and benefits
376.1 
354.9 
Other current liabilities
476.3 
410.2 
Current liabilities of discontinued operations
0 
118.6 
Total current liabilities
2,307.1 
2,178.8 
Long-term debt due after one year
5,513.9 
5,558.2 
Pension liabilities, net of current portion
278.4 
316.0 
Postretirement benefit liabilities, net of current portion
145.3 
143.0 
Non-recourse liabilities held by special purpose entities
1,172.3 
1,179.6 
Deferred income taxes
3,283.0 
3,189.7 
Other long-term liabilities
709.3 
647.2 
Long-term liabilities of discontinued operations
0 
361.8 
Commitments and contingencies (Note 15)
   
 
Redeemable noncontrolling interests
14.3 
14.2 
Equity:
 
 
Preferred stock, $0.01 par value; 30.0 million shares authorized; no shares outstanding
0 
0 
Common Stock, $0.01 par value; 600.0 million shares authorized; 251.5 million and 257.0 million shares outstanding at June 30, 2016 and September 30, 2015, respectively
2.5 
2.6 
Capital in excess of par value
10,438.7 
10,767.8 
Retained earnings
83.3 
1,661.6 
Accumulated other comprehensive loss
(611.4)1
(780.2)1
Total stockholders’ equity
9,913.1 
11,651.8 
Noncontrolling interests
109.7 
132.1 
Total equity
10,022.8 
11,783.9 
Liabilities and Equity
$ 23,446.4 
$ 25,372.4 
Condensed Consolidated Balance Sheets (Parentheticals) (USD $)
In Millions, except Share data, unless otherwise specified
Jun. 30, 2016
Sep. 30, 2015
Allowance for Doubtful Accounts Receivable, Current
$ 38.5 
$ 29.5 
Preferred Stock, Par or Stated Value Per Share
$ 0.01 
$ 0.01 
Preferred Stock, Shares Authorized
30,000,000 
30,000,000 
Preferred Stock, Shares Outstanding
0 
0 
Common Stock, Par or Stated Value Per Share
$ 0.01 
$ 0.01 
Common Stock, Shares Authorized
600,000,000 
600,000,000 
Common Stock, Shares, Outstanding
251,500,000 
257,000,000 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Operating activities:
 
 
Consolidated net income (loss)
$ (298.2)
$ 393.9 
Adjustments to reconcile consolidated net (loss) income to net cash provided by operating activities:
 
 
Depreciation, depletion and amortization
867.7 
459.5 
Cost of real estate sold
50.1 
0 
Deferred income tax expense
35.4 
152.1 
Share-based compensation expense
51.8 
28.5 
Loss on disposal of plant, equipment and other, net
1.9 
1.3 
Equity in income of unconsolidated entities
(6.8)
(7.3)
Pension and other postretirement funding (more) than expense (income)
(69.0)
(120.6)
Gain on Grupo Gondi investment
(12.1)
0 
Cash surrender value increase in excess of premiums paid
(23.7)
0 
Impairment adjustments
191.3 
3.0 
Other non-cash items
(34.1)
(6.0)
Impairment of Specialty Chemicals goodwill and intangibles
579.4 
0 
Change in operating assets and liabilities, net of acquisitions and divestitures:
 
 
Accounts receivable
51.0 
69.0 
Inventories
25.8 
(7.8)
Other assets
(79.3)
(111.9)
Accounts payable
(104.1)
(41.8)
Income taxes
(13.0)
(10.5)
Accrued liabilities and other
92.7 
15.2 
Net cash provided by operating activities
1,306.8 
816.6 
Investing activities:
 
 
Capital expenditures
(614.7)
(358.9)
Cash (paid) received for purchase of businesses, net of cash acquired
(376.4)
3.7 
Debt purchased in connection with an acquisition
(36.5)
0 
Investment in unconsolidated entities
(178.5)
0 
Return of capital from unconsolidated entities
5.4 
0.8 
Proceeds from sale of subsidiary and affiliates
10.2 
0 
Proceeds from sale of property, plant and equipment
10.9 
22.8 
Net cash used for investing activities
(1,179.6)
(331.6)
Financing activities:
 
 
Additions (repayments) to revolving credit facilities
180.6 
(84.9)
Additions to debt
1,458.3 
221.3 
Repayments of debt
(1,012.2)
(473.9)
Other financing additions
2.5 
2.0 
Debt issuance costs
(3.6)
(0.1)
Specialty Chemicals spin-off of cash and trust funding
(118.9)
0 
Issuances of common stock, net of related minimum tax withholdings
(3.8)
(24.6)
Purchases of common stock
(285.1)
(8.7)
Excess tax benefits from share-based compensation
0.1 
16.7 
Repayments to unconsolidated entity
(1.0)
(0.8)
Cash dividends paid to shareholders
(286.3)
(116.6)
Cash distributions paid to noncontrolling interests
(21.8)
(2.1)
Net cash used for financing activities
(91.2)
(471.7)
Effect of exchange rate changes on cash and cash equivalents
(5.6)
(2.7)
Increase in cash and cash equivalents
30.4 
10.6 
Cash and cash equivalents from continuing operations, at beginning of period
207.8 
32.6 
Cash and cash equivalents from discontinued operations, at beginning of period
20.5 
0 
Balance of cash and cash equivalents at beginning of period
228.3 
32.6 
Cash and cash equivalents from continuing operations, at end of period
258.7 
43.2 
Cash and cash equivalents from discontinued operations, at end of period
0 
0 
Balance of cash and cash equivalents at end of period
258.7 
43.2 
Supplemental disclosure of cash flow information:
 
 
Income taxes, net of refunds
118.5 
47.6 
Interest, net of amounts capitalized
$ 167.3 
$ 47.0 
Condensed Consolidated Statements of Cash Flows (Parentheticals) (USD $)
9 Months Ended
Jun. 30, 2016
Fair value of assets acquired, including goodwill
$ 583,400,000 
Cash consideration for the purchase of businesses, net of cash acquired
376,400,000 
Debt purchased in connection with an acquisition
36,500,000 
Liabilities assumed
170,500,000 
Debt assumed in acquisitions
15,000,000 
Noncash, Accounts receivable
34,700,000 
Noncash, Inventories
25,800,000 
Noncash, Other assets
86,300,000 
Noncash, Accounts payable
(15,400,000)
Noncash, Income taxes
(1,000,000)
Noncash, Accrued liabilities and other
(18,800,000)
Noncash, Investment in unconsolidated entities
$ (123,700,000)
General Discussion on Notes to Consolidated Financial Statements
Nature of Operations
Unless the context otherwise requires, “we”, “us”, “our”, “WestRock” and “the Company” refer to the business of WestRock Company, its wholly-owned subsidiaries and its partially-owned consolidated subsidiaries.

We are one of North America’s leading providers of packaging solutions and manufacturers of containerboard and paperboard. We operate locations in North America, South America, Europe and Asia. We also develop real estate in Charleston, SC.
Interim Financial Statements
Interim Financial Statements
Interim Financial Statements

Our independent registered public accounting firm has not audited our accompanying interim financial statements. We derived the Condensed Consolidated Balance Sheet at September 30, 2015 from the audited Consolidated Financial Statements included in our Fiscal 2015 Form 10-K. In the opinion of our management, the Condensed Consolidated Financial Statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of our statements of operations for the three and nine months ended June 30, 2016 and June 30, 2015, our comprehensive income (loss) for the three and nine months ended June 30, 2016 and June 30, 2015, our financial position at June 30, 2016 and September 30, 2015, and our cash flows for the nine months ended June 30, 2016 and June 30, 2015.

On May 15, 2016, WestRock distributed 100% of the outstanding common stock, par value $0.01 per share, of Ingevity to WestRock’s shareholders and completed the separation of our Specialty Chemicals business from WestRock. Ingevity is now an independent public company trading under the symbol “NGVT” on the New York Stock Exchange. With the completion of the Separation, we disposed of the former Specialty Chemicals segment in its entirety and ceased to consolidate its assets, liabilities and results of operations in our Condensed Consolidated Financial Statements. Accordingly, we have presented the financial position and results of operations of our former Specialty Chemicals segment as discontinued operations in the accompanying Condensed Consolidated Financial Statements for all periods presented. See “Note 6. Discontinued Operations” for more information.
 
We have condensed or omitted certain notes and other information from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these interim statements should be read in conjunction with our Fiscal 2015 Form 10-K. The results for the three and nine months ended June 30, 2016 are not necessarily indicative of results that may be expected for the full year.
New Accounting Standards
New Accounting Standards
New Accounting Standards

Recently Adopted Standards

In November 2015, the FASB issued ASU 2015-17 “Balance Sheet Classification of Deferred Taxes”, which amends certain provisions of ASC 740 “Income Taxes”. The ASU requires that all deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. In addition, companies will no longer allocate valuation allowances between current and noncurrent deferred tax assets because those allowances also will be classified as noncurrent. The ASU is effective for annual periods, and for interim periods within those annual periods, beginning after December 15, 2016. Early adoption was permitted for all companies in any interim or annual period. The guidance may be adopted on either a prospective or retrospective basis. We adopted these provisions prospectively on December 31, 2015, and prior periods were not retrospectively adjusted. The adoption did not have a material effect on our consolidated financial statements.

Recently Issued Standards

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit losses: Measurement of Credit Losses on Financial Instruments”, which amends certain provisions of ASU 326, “Financial Instruments-Credit Loss”. The ASU changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held to maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowances for losses. For available for sale debt securities with unrealized losses, entities will be required to measure credit losses in a manner similar to what they do today, except that losses will be recognized as allowances rather than reductions in the amortized cost of the securities. Additionally, entities will have to disclose significantly more information, including information used to track credit quality by year or origination for most financing receivables. The ASU is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual periods, and will be applied as a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period for which the guidance is effective. We expect to adopt these provisions on October 1, 2020, including interim periods subsequent to the date of adoption. We do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.

In May 2016, the FASB issued ASU 2016-12 “Revenue from Contracts with Customer, Narrow-Scope Improvements and Practical Expedients”, which amends its new revenue recognition guidance on transitioning to the new revenue recognition standard, collectibility, non-cash consideration and the presentation of sales and other similar taxes. The ASU clarifies that, for a contract to be considered completed at transition, all (or substantially all) of the revenue must have been recognized under legacy GAAP. The ASU also clarifies how an entity should evaluate the collectibility threshold and when an entity can recognize nonrefundable consideration received as revenue if an arrangement does not meet the standard’s contract criteria. The ASU is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods, and can be applied using a full retrospective or modified retrospective approach. We expect to adopt these provisions on October 1, 2018, including interim periods subsequent to the date of adoption. We are evaluating the impact of these provisions.

In March 2016, the FASB issued ASU 2016-09 “Compensation—Stock Compensation: Improvements To Employee Share Based Payment Accounting”, which amends certain provisions of ASU 718, “Compensation - Stock Compensation”. The ASU will require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also will allow an employer to repurchase more of an employee’s shares than it can today for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. The provisions are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We expect to adopt these provisions on October 1, 2017, and based on our current stock compensation awards, the adoption is not expected to have a material effect on our consolidated financial statements.
 
In March 2016, the FASB issued ASU 2016-08 “Revenue from Contracts with Customer, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” to clarify the principal versus agent guidance in its new revenue recognition standard. The amendments clarify how an entity should identify the unit of accounting for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. These provisions also clarify the indicators to determine when an entity is acting as a principal or an agent. The ASU is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual periods, and can be applied using a full retrospective or modified retrospective approach. We expect to adopt these provisions on October 1, 2018, including interim periods subsequent to the date of adoption. We are evaluating the impact of these provisions.

In March 2016, the FASB issued ASU 2016-07 “Investments—Equity Method and Joint Ventures: Simplifying the Transition to the Equity Method of Accounting”, which amends certain provisions of ASU 323 “Investments-Equity Method and Joint Ventures”. The ASU eliminates the requirement that an investor retrospectively apply equity method accounting when an investment that it had accounted for by another method initially qualifies for the equity method. The guidance will be applied prospectively and is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We expect to adopt these provisions on October 1, 2017, including interim periods subsequent to the date of adoption. We do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.

In March 2016, the FASB issued ASU 2016-05 “Derivatives and Hedging--Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships”, which amends certain provisions of ASU 815 “Derivatives and Hedging”. The ASU clarifies that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument under ASC 815 does not, in and of itself, require de-designation of the instrument if all other hedge criteria continue to be met. These provisions are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and can be adopted using a prospective or modified retrospective approach. Early adoption is permitted. We expect to adopt these provisions on October 1, 2017, including interim periods subsequent to the date of adoption, and do not expect that these provisions will have a material effect on our consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02 “Leases”, which is codified in ASC 842 “Leases” and supersedes current lease guidance in ASC 840. These provisions require lessees to put a right-of-use asset and lease liability on their balance sheet for operating and financing leases that have a term of more than one year. Expense will be recognized in the income statement similar to current accounting guidance. For lessors, the ASU modifies the classification criteria and the accounting for sales-type and direct financing leases. Entities will need to disclose qualitative and quantitative information about their leases, including characteristics and amounts recognized in the financial statements. These provisions are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. We expect to adopt these provisions on October 1, 2019, including interim periods subsequent to the date of adoption. Entities are required to use a modified retrospective approach upon adoption to recognize and measure leases at the beginning of the earliest comparative period presented in the financial statements. We are evaluating the impact of these provisions.
 
In September 2015, the FASB issued ASU 2015-16 “Simplifying the Accounting for Measurement-Period Adjustments”, which amends certain provisions of ASC 805 “Business Combinations”. The ASU mandates that measurement-period adjustments be recorded by the acquirer in the period these amounts are determined, and eliminates the requirement to record them retrospectively. These provisions are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years, applied prospectively to open measurement periods. We expect to adopt these provisions on October 1, 2016, including interim periods subsequent to the date of adoption. We are evaluating the impact of these provisions.

In July 2015, the FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory”, which amends certain provisions of ASC 330 “Inventory”. The ASU requires inventory to be measured at the lower of cost and net realizable value. These provisions do not apply to inventory that is measured using LIFO or the retail inventory method. These provisions apply to all other inventory, which includes inventory that is measured using FIFO or average cost. These provisions are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, applied prospectively. Early adoption is permitted as of the beginning of an interim or annual reporting period. We expect to adopt these provisions on October 1, 2017, including interim periods subsequent to the date of adoption, prospectively. Given that the majority of our inventory is measured using LIFO, we do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.

In May 2015, the FASB issued ASU 2015-07 “Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share”. The ASU amends ASC 820 “Fair Value Measurement” and eliminates the requirement to categorize within the fair value hierarchy investments for which fair value is measured using the net asset value (or its equivalent) practical expedient. Investments for which fair value is measured at net asset value per share using the practical expedient should not be categorized in the fair value hierarchy. However, disclosures on investments for which fair value is measured at net asset value as a practical expedient should continue to be disclosed to help users understand the nature and risks of the investments and whether the investments, if sold, are probable of being sold at amounts different from net asset value. The ASU is effective for annual periods, and for interim periods within those annual periods, beginning after December 15, 2015. We expect to adopt these provisions on October 1, 2016, including interim periods subsequent to the date of adoption, applied retrospectively to all periods presented. We do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.
 
In April 2015, the FASB issued ASU 2015-05 “Customers Accounting for Fees Paid in a Cloud Computing Arrangement”, which amends ASC 350 “Intangibles-Goodwill and Other Internal-Use Software”. The ASU requires entities to record a software license intangible asset if a hosting arrangement for internal-use software allows the entity to take possession of the software, and it is feasible that the entity can run the software on its own hardware, or contract a vendor to host the software. These provisions are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2015. We expect to adopt these provisions on October 1, 2016, including interim periods subsequent to the date of adoption. We are evaluating the impact of these provisions.

In April 2015, the FASB issued ASU 2015-04 “Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets”. The ASU amends ASC 715 “Retirement Plans” and allows entities to use a practical expedient to measure defined benefit plan assets and obligations using a month-end that is closest to the entity’s fiscal year end, as well as the option to use the closest date to a significant event when plan assets and obligations are remeasured. These provisions are effective for annual periods, and for interim periods within those annual periods, beginning after December 15, 2015. Early application is permitted. We expect to adopt these provisions on October 1, 2016, including interim periods subsequent to the date of adoption. We do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.

In February 2015, the FASB issued ASU 2015-02 “Consolidation-Amendments to the Consolidation Analysis”, which amends certain provisions of ASC 810 “Consolidation”. The amendment requires the consideration of additional criteria in (i) the analysis and determination of whether limited partnerships and similar legal entities are variable interest entities or voting interest entities and (ii) primary beneficiary determinations. The ASU also eliminates certain fees from the consolidation analysis of reporting entities that are involved with variable interest entities. The ASU is effective for annual periods, and for interim periods within those annual periods, beginning after December 15, 2015. We expect to adopt these provisions on October 1, 2016, including interim periods subsequent to the date of adoption. We do not expect that the adoption of these provisions will have a material effect on our consolidated financial statements.

In June 2014, the FASB issued ASU 2014-12 “Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period”. The ASU amends ASC 718 “Compensation - Stock Compensation” and clarifies that a performance target in a share-based payment that affects vesting and that could be achieved after the requisite service period should be accounted for as a performance condition and impact compensation cost when it is probable the performance target will be achieved. These provisions are effective for annual periods beginning after December 15, 2015. We expect to adopt these provisions on October 1, 2016, and based on our current stock compensation awards, the adoption is not expected to have a material effect on our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09 which is codified in ASC 606 “Revenue from Contracts with Customers” and supersedes both the revenue recognition requirement to ASC 605 “Revenue Recognition” and most industry-specific guidance. The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the five steps set forth in ASC 606. An entity must also disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date,” which deferred the effective date of ASU 2014-09 by one year. Therefore, these provisions are effective for annual reporting periods beginning after December 15, 2017 (October 1, 2018 for us), including interim periods within that annual period, and can be applied using a full retrospective or modified retrospective approach. We are evaluating the impact of these provisions.
Equity and Other Comprehensive Income
Comprehensive Income and Equity Note
Equity and Other Comprehensive (Loss) Income

Equity

The following is a summary of the changes in total equity for the nine months ended June 30, 2016 (in millions):
 
WestRock
Company
Stockholders’
Equity
 
Noncontrolling (1)
Interests
 
Total
Equity
Balance at September 30, 2015
$
11,651.8

 
$
132.1

 
$
11,783.9

Net (loss) income attributable to common stockholders
(304.3
)
 
4.2

 
(300.1
)
Other comprehensive income, net of tax
160.9

 
—

 
160.9

Noncontrolling interests assumed in acquisition
—

 
10.9

 
10.9

Income tax expense from share-based plans
(12.3
)
 
—

 
(12.3
)
Compensation expense under share-based plans
52.7

 
—

 
52.7

Cash dividends declared (per share - $1.125)(2)
(288.9
)
 
—

 
(288.9
)
Distributions and adjustments to noncontrolling interests
—

 
(11.2
)
 
(11.2
)
Sale of subsidiary shares from noncontrolling interest
—

 
(0.2
)
 
(0.2
)
Issuance of common stock, net of stock received for minimum tax withholdings
(3.2
)
 
—

 
(3.2
)
Purchases of common stock
(285.1
)
 
—

 
(285.1
)
Separation of Specialty Chemicals business
(1,058.5
)
 
(26.1
)
 
(1,084.6
)
Balance at June 30, 2016
$
9,913.1

 
$
109.7

 
$
10,022.8


(1) 
Excludes amounts related to contingently redeemable noncontrolling interests, which are separately classified outside of permanent equity in the mezzanine section of the Condensed Consolidated Balance Sheets.
(2) 
Includes cash dividends paid, and dividends declared but unpaid, related to the shares reserved but unissued to satisfy Smurfit-Stone bankruptcy claims.

Stock Repurchase Program

In July 2015, our board of directors authorized a repurchase program of up to 40.0 million shares of Common Stock, representing approximately 15 percent of our outstanding Common Stock as of July 1, 2015. The shares of Common Stock may be repurchased over an indefinite period of time at the discretion of management. As of September 30, 2015, the remaining authorization under our repurchase program was approximately 34.6 million shares. Pursuant to that repurchase program, in the nine months ended June 30, 2016, we repurchased approximately 7.0 million shares of Common Stock for an aggregate cost of $285.1 million. As of June 30, 2016, we had approximately 27.6 million shares of Common Stock available for repurchase under the program.

Accumulated Other Comprehensive Loss

The tables below summarize the changes in accumulated other comprehensive loss, net of tax, by component for the nine months ended June 30, 2016 and June 30, 2015 (in millions):

 
Cash Flow Hedges
 
Defined Benefit Pension and Postretirement Plans
 
Foreign Currency Items
 
Total (1)
Balance at September 30, 2015
$
(1.4
)
 
$
(540.7
)
 
$
(238.1
)
 
$
(780.2
)
Other comprehensive (loss) income before reclassifications
(0.5
)
 
1.4

 
133.4

 
134.3

Amounts reclassified from accumulated other comprehensive loss
1.0

 
5.4

 
20.2

 
26.6

Specialty Chemicals separation
0.4

 
1.9

 
5.6

 
7.9

Net current period other comprehensive income
0.9

 
8.7

 
159.2

 
168.8

Balance at June 30, 2016
$
(0.5
)
 
$
(532.0
)
 
$
(78.9
)
 
$
(611.4
)

(1)     All amounts are net of tax and noncontrolling interest.

 
Cash Flow Hedges
 
Defined Benefit Pension and Postretirement Plans
 
Foreign Currency Items
 
Total (1)
Balance at September 30, 2014
$
(0.2
)
 
$
(498.2
)
 
$
3.1

 
$
(495.3
)
Other comprehensive loss before reclassifications
—

 
(16.5
)
 
(44.5
)
 
(61.0
)
Amounts reclassified from accumulated other comprehensive loss
—

 
23.8

 
—

 
23.8

Net current period other comprehensive income (loss)
—

 
7.3

 
(44.5
)
 
(37.2
)
Balance at June 30, 2015
$
(0.2
)
 
$
(490.9
)
 
$
(41.4
)
 
$
(532.5
)

(1)     All amounts are net of tax and noncontrolling interest.

The net of tax amounts were determined using effective tax rates averaging approximately 34% to 35% for the nine months ended June 30, 2016 and 38% to 39% for the nine months ended June 30, 2015. Although we are impacted by a number of currencies, foreign currency translation gains recorded in accumulated other comprehensive loss for the nine months ended June 30, 2016 were primarily due to the changes in the Brazilian Real/U.S. dollar and Canadian/U.S. dollar exchange rates. Foreign currency translation gains and losses recorded in accumulated other comprehensive loss for the nine months ended June 30, 2015 were primarily due to the change in the Canadian/U.S. dollar exchange rates. For the nine months ended June 30, 2016, we recorded defined benefit net actuarial gains of $1.4 million, net of tax of $0.8 million, in other comprehensive (loss) income, primarily due to the partial settlement and curtailment of certain defined benefit plans. For the nine months ended June 30, 2015, we recorded defined benefit net actuarial losses and prior service costs, net of tax, in other comprehensive (loss) income of $3.3 million and $13.2 million, respectively, primarily due to the partial settlement, plan amendments and curtailment of certain defined benefit plans. The deferred income tax expense associated with the net actuarial losses and prior service costs was $2.0 million and $8.3 million, respectively. The amounts reclassified out of accumulated other comprehensive loss into earnings for these events are summarized in the reclassifications tables below.

The following table summarizes the reclassifications out of accumulated other comprehensive loss by component (in millions):

 
Three Months Ended
 
Three Months Ended
 
June 30, 2016
 
June 30, 2015
 
Pretax
 
Tax
 
Net of Tax
 
Pretax
 
Tax
 
Net of Tax
Amortization of defined benefit pension and postretirement items (1)
 
 
 
 
 
 
 
 
 
 
 
      Actuarial losses (2)
$
(1.9
)
 
$
0.6

 
$
(1.3
)
 
$
(9.9
)
 
$
3.7

 
$
(6.2
)
      Prior service (costs) credits (2)
(0.4
)
 
0.3

 
(0.1
)
 
—

 
—

 
—

Subtotal defined benefit plans
(2.3
)
 
0.9

 
(1.4
)
 
(9.9
)
 
3.7

 
(6.2
)
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 
 
 
 
 
 
 
 
 
 
 
      Sale of foreign subsidiary (3)
(20.2
)
 
—

 
(20.2
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments (1)

 
 
 
 
 
 
 
 
 
 
 
      Commodity cash flow hedges (4)

(0.3
)
 
—

 
(0.3
)
 
—

 
—

 
—

      Foreign currency cash flow hedges (5)

(0.5
)
 
0.2

 
(0.3
)
 
—

 
—

 
—

Subtotal derivative instruments


(0.8
)
 
0.2

 
(0.6
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Total reclassifications for the period
$
(23.3
)
 
$
1.1

 
$
(22.2
)
 
$
(9.9
)
 
$
3.7

 
$
(6.2
)

(1)  
Amounts in parentheses indicate charges to earnings. Amounts pertaining to noncontrolling interests are excluded.
(2) 
Included in the computation of net periodic pension cost (See “Note 13. Retirement Plans” for additional details).
(3) 
Included in interest income and other income (expense), net.
(4) 
Included in cost of goods sold.
(5) 
Included in net sales.

The following table summarizes the reclassifications out of accumulated other comprehensive loss by component (in millions):      
 
Nine Months Ended
 
Nine Months Ended
 
June 30, 2016
 
June 30, 2015
 
Pretax
 
Tax
 
Net of Tax
 
Pretax
 
Tax
 
Net of Tax
Amortization of defined benefit pension and postretirement items (1)
 
 
 
 
 
 
 
 
 
 
 
      Actuarial losses (2)
$
(6.5
)
 
$
1.9

 
$
(4.6
)
 
$
(46.2
)
 
$
17.5

 
$
(28.7
)
      Prior service (cost) credits (2)
(1.3
)
 
0.5

 
(0.8
)
 
8.0

 
(3.1
)
 
4.9

Subtotal defined benefit plans
(7.8
)
 
2.4

 
(5.4
)
 
(38.2
)
 
14.4

 
(23.8
)
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 
 
 
 
 
 
 
 
 
 
 
      Sale of foreign subsidiary (3)
(20.2
)
 
—

 
(20.2
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments (1)
 
 
 
 
 
 
 
 
 
 
 
    Commodity cash flow hedges (4)
(1.4
)
 
0.5

 
(0.9
)
 
—

 
—

 
—

    Foreign currency cash flow hedges (5)
(0.2
)
 
0.1

 
(0.1
)
 
—

 
—

 
—

Subtotal derivative instruments
(1.6
)
 
0.6

 
(1.0
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Total reclassifications for the period
$
(29.6
)
 
$
3.0

 
$
(26.6
)
 
$
(38.2
)
 
$
14.4

 
$
(23.8
)

(1)  
Amounts in parentheses indicate charges to earnings. Amounts pertaining to noncontrolling interests are excluded.
(2) 
Included in the computation of net periodic pension cost (see “Note 13. Retirement Plans” for additional details).
(3) 
Included in interest income and other income (expense), net.
(4) 
Included in cost of goods sold.
(5) 
Included in net sales.
Earnings per Share
Earnings Per Share
Earnings per Share

Our restricted stock awards granted to non-employee directors are considered participating securities as they receive non-forfeitable rights to dividends at the same rate as Common Stock. As participating securities, we include these instruments in the earnings allocation in computing earnings per share under the two-class method described in ASC 260 “Earnings per Share”. The following table sets forth the computation of basic and diluted earnings per share under the two-class method (in millions, except per share data):
 
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Basic earnings (loss) per share:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Income from continuing operations

$
152.4

 
$
157.9

 
$
241.2

 
$
393.9

Less: Net income from continuing operations attributable to noncontrolling interest
(0.4
)
 
(1.5
)
 
(1.8
)
 
(2.6
)
Income available to common stockholders, before discontinued operations

152.0

 
156.4

 
239.4

 
391.3

Loss from discontinued operations (1)
(59.7
)
 
—

 
(543.7
)
 
—

Net income (loss) attributable to common stockholders
$
92.3

 
$
156.4

 
$
(304.3
)
 
$
391.3

Denominator:
 
 
 
 
 
 
 
Basic weighted average shares outstanding
252.7

 
141.1

 
254.8

 
140.7

 
 
 
 
 
 
 
 
Basic earnings per share from continuing operations
$
0.60

 
$
1.11

 
$
0.94

 
$
2.78

Basic loss per share from discontinued operations
(0.23
)
 
—

 
(2.13
)
 
—

Basic earnings (loss) per share attributable to common stockholders
$
0.37

 
$
1.11

 
$
(1.19
)
 
$
2.78

 
 
 
 
 
 
 
 
Diluted earnings (loss) per share:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Income from continuing operations

$
152.4

 
$
157.9

 
$
241.2

 
$
393.9

Less: Net income from continuing operations attributable to noncontrolling interest
(0.4
)
 
(1.5
)
 
(1.8
)
 
(2.6
)
Income available to common stockholders, before discontinued operations

152.0

 
156.4

 
239.4

 
391.3

Loss from discontinued operations (1)
(59.7
)
 
—

 
(543.7
)
 
—

Net income (loss) attributable to common stockholders
$
92.3

 
$
156.4

 
$
(304.3
)
 
$
391.3

Denominator:
 
 
 
 
 
 
 
Basic weighted average shares outstanding
252.7

 
141.1

 
254.8

 
140.7

Effect of dilutive stock options and non-participating securities
3.5

 
1.6

 
3.8

 
2.0

Diluted weighted average shares outstanding
256.2

 
142.7

 
258.6

 
142.7

 
 
 
 
 
 
 
 
Diluted earnings per share from continuing operations
$
0.59

 
$
1.10

 
$
0.93

 
$
2.74

Diluted loss per share from discontinued operations
(0.23
)
 
—

 
(2.11
)
 
—

Diluted earnings (loss) per share attributable to common stockholders
$
0.36

 
$
1.10

 
$
(1.18
)
 
$
2.74



(1)  
Net of income attributable to noncontrolling interests of discontinued operations of $1.0 million and $4.3 million for the three and nine months ended June 30, 2016, respectively.

During the three and nine months ended June 30, 2016 and June 30, 2015 in the table above, the amount of distributed and undistributed income available to participating securities was de minimis and did not impact net income attributable to common stockholders.

Weighted average shares includes approximately 0.3 million of reserved, but unissued shares at each of June 30, 2016 and June 30, 2015. These reserved shares will be distributed as claims are liquidated or resolved in accordance with the Smurfit-Stone Plan of Reorganization and Confirmation Order.

Options and restricted stock in the amount of 1.9 million and 1.8 million common shares, respectively, in the three and nine months ended June 30, 2016, respectively, were not included in computing diluted earnings per share because the effect would have been antidilutive. Options and restricted stock in the amount of 0.3 million and 0.4 million common shares, respectively, in the three and nine months ended June 30, 2015, respectively, were not included in computing diluted earnings per share because the effect would have been antidilutive.
Acquisitions
Business Combination Disclosure [Text Block]
Merger, Acquisitions and Investment

Grupo Gondi Investment
On April 1, 2016, we completed the formation of a joint venture with Grupo Gondi to combine our respective operations in Mexico. We contributed $175.0 million in cash and the stock of an entity that owns three corrugated packaging facilities in Mexico in return for a 25.0 percent equity participation in the joint venture valued at approximately $0.3 billion. The cash contribution was borrowed at March 31, 2016 in order to fund at closing. The joint venture operates paper machines, corrugated packaging and high graphic folding carton facilities across 13 production sites. The cash contribution will remain in the joint venture and will be available to support its growth. As the majority equity holder, Grupo Gondi will manage the joint venture and we will provide technical and commercial resources. We believe the joint venture will help grow our presence in the attractive Mexican market. As a result of the transaction, we recorded a pre-tax non-cash gain of $12.1 million included in “Interest income and other income (expense), net” on our Condensed Consolidated Statements of Operations. The transaction includes future put and call rights with respect to the respective parties’ ownership interest in the joint venture. We have included the financial results of the Grupo Gondi investment since the formation in our Corrugated Packaging segment, and are accounting for the investment on the equity method. We are in the process of analyzing third-party valuation of certain tangible and intangible assets; thus, the allocation of the purchase price used for equity accounting is preliminary and subject to revision.

Packaging Acquisition

On January 19, 2016, we completed the purchase of certain legal entities formerly owned by Cenveo Inc. The entities acquired provide value-added folding carton and litho-laminated display packaging solutions. The purchase price was $97.6 million, net of cash received of $1.7 million and a working capital settlement. The transaction is subject to an election under Section 338(h)(10) of the Code that will increase the U.S. tax basis in the acquired U.S. assets for an as yet to be determined amount. We believe the transaction has provided us with attractive and complementary customers, markets and facilities. We have included the financial results of the acquired entities since the date of the acquisition in our Consumer Packaging segment.

The preliminary purchase price allocation for the acquisition included $10.3 million of customer relationship intangible assets, $10.2 million of goodwill and $26.1 million of liabilities, including $1.3 million of debt. We are amortizing the customer relationship intangibles over estimated useful lives ranging from 9 to 15 years based on a straight-line basis because the amortization pattern was not reliably determinable. The fair value assigned to goodwill is primarily attributable to buyer-specific synergies expected to arise after the acquisition (e.g., enhanced reach of the combined organization and other synergies), and the assembled work force. We expect the goodwill and intangibles of the U.S. entities to be amortizable for income tax purposes. We are in the process of analyzing the estimated fair values of all assets acquired and liabilities assumed including, among other things, obtaining final third-party valuations of certain tangible and intangible assets as well as the fair value of certain contracts and the determination of certain tax balances; thus, the allocation of the purchase price is preliminary and subject to revision.

SP Fiber

On October 1, 2015, we acquired SP Fiber in a stock purchase. The transaction included the acquisition of mills located in Dublin, GA and Newberg, OR, which produce lightweight recycled containerboard and kraft and bag paper. The Newberg mill also produced newsprint. As part of the transaction, we also acquired SP Fiber's 48 percent interest in GPS. GPS is a renewable energy joint venture providing steam to the Dublin mill and energy to Georgia Power. The purchase price was $278.8 million, net of cash received of $9.2 million. In addition, we paid $36.5 million for debt owed by GPS and thereby own the majority of the debt issued by GPS.

We believe the Dublin mill will help balance the fiber mix of our mill system and that the addition of kraft and bag paper will diversify our product offering, including our ability to serve the increasing demand for lighter weight containerboard. Subsequent to the transaction, we announced the permanent closure of the Newberg mill due to the decline in market conditions of the newsprint business and our need to balance supply and demand in our containerboard system. We determined GPS should be consolidated as a variable interest entity under ASC 810 “Consolidation”. Our evaluation concluded that WestRock is the primary beneficiary of GPS as WestRock has both the power and benefits as defined by ASC 810. We have included the financial results of SP Fiber and GPS since the date of the acquisition in our Corrugated Packaging segment.

The preliminary purchase price allocation for the acquisition included $13.5 million of customer relationship intangible assets, $50.5 million of goodwill, including recording an adjustment to deferred taxes in the second quarter of fiscal 2016, and $144.4 million of liabilities, including $13.7 million of debt primarily owed by GPS to third parties. We are amortizing the customer relationship intangibles over 20 years based on a straight-line basis because the amortization pattern was not reliably determinable. The fair value assigned to goodwill is primarily attributable to buyer-specific synergies expected to arise after the acquisition (e.g., enhanced reach of the combined organization and other synergies), the assembled work force of SP Fiber as well as due to establishing deferred taxes for the assets and liabilities acquired. The goodwill and intangibles will not be amortizable for income tax purposes. We are in the process of analyzing the estimated fair values of all assets acquired and liabilities assumed including, among other things, obtaining final third-party valuations of certain tangible and intangible assets as well as the fair value of certain contracts and the determination of certain tax balances; thus, the allocation of the purchase price is preliminary and subject to revision.

The Combination

On July 1, 2015, pursuant to the Business Combination Agreement, RockTenn and MWV completed a strategic combination of their respective businesses. Pursuant to the Business Combination Agreement, RockTenn and MWV became wholly owned subsidiaries of WestRock. RockTenn is the accounting acquirer.

The consideration for the Combination was $8,286.7 million. In connection with the Combination, RockTenn shareholders received in the aggregate approximately 130.4 million shares of Common Stock and approximately $667.8 million in cash. At the effective time of the Combination, each share of common stock, par value $0.01 per share, of MWV issued and outstanding immediately prior to the effective time of the Combination was converted into the right to receive 0.78 shares of Common Stock. In the aggregate, MWV stockholders received approximately 131.2 million shares of Common Stock (which includes shares issued under certain MWV equity awards that vested as a result of the Combination). Included in the consideration was approximately $210.9 million related to the value of outstanding MWV equity awards that were replaced with WestRock equity awards with identical terms for pre-combination service. The value related to post-combination service will be expensed over the remaining service period of the awards.



The following table summarizes the fair values of the assets acquired and liabilities assumed by major class of assets and liabilities as of the acquisition date, as well as adjustments made during fiscal 2016 (referred to as “measurement period adjustments”) (in millions):
 
Amounts Recognized as of the Acquisition Date (1)
 
Measurement Period Adjustments (2)
 
Amounts Recognized as of Acquisition Date (as Adjusted) (3)
Cash and cash equivalents
$
265.7

 
$
—

 
$
265.7

Current assets, excluding cash and cash equivalents
1,858.8

 
4.8

 
1,863.6

Property, plant and equipment
3,991.5

 
16.7

 
4,008.2

Prepaid pension asset
1,407.8

 
(9.9
)
 
1,397.9

Goodwill
3,817.3

 
55.3

 
3,872.6

Intangible assets
2,994.2

 
—

 
2,994.2

Restricted assets held by special purpose entities
1,302.0

 
—

 
1,302.0

Other long-term assets
363.8

 
18.4

 
382.2

Total assets acquired
16,001.1

 
85.3

 
16,086.4

 
 
 
 
 
 
Current portion of debt
62.3

 
74.8

 
137.1

Current liabilities
1,099.4

 
(47.3
)
 
1,052.1

Long-term debt due after one year
2,090.6

 
18.3

 
2,108.9

Non-recourse liabilities held by special purpose entities
1,181.0

 
—

 
1,181.0

Accrued pension and other long-term benefits
235.1

 
—

 
235.1

Deferred income tax liabilities
2,366.7

 
(4.4
)
 
2,362.3

Other long-term liabilities
520.0

 
43.9

 
563.9

Noncontrolling interest
159.3

 
—

 
159.3

Total liabilities and noncontrolling interest assumed
7,714.4

 
85.3

 
7,799.7

 
 
 
 
 
 
Net assets acquired (4)
$
8,286.7

 
$
—

 
$
8,286.7

(1) 
As previously reported in “Note 6. Merger and Acquisitions” of the Notes to Consolidated Financial Statements section of the Fiscal 2015 Form 10-K.

(2) 
The measurement period adjustments recorded in fiscal 2016 did not have a significant impact on our condensed consolidated statements of operations for the three months ended September 30, 2015 or the three and nine months ended June 30, 2016. In addition, these adjustments did not have a significant impact on our consolidated balance sheet as of September 30, 2015. Therefore, we have recorded the cumulative impact in fiscal 2016 and have not retrospectively adjusted the comparative 2015 financial information presented herein.

(3) 
The measurement period adjustments were due primarily to refinements to third party appraisals and carrying amounts of certain assets and liabilities as well as adjustments to certain tax accounts based on, among other things, adjustments to deferred tax liabilities, including any appraisal adjustments, analysis of the tax basis of acquired assets and liabilities, other tax adjustments and the classification of supplier financing arrangements. The net impact of the measurement period adjustments resulted in a net increase to goodwill.

(4) 
The net assets acquired include the Specialty Chemicals business which was separated on May 15, 2016. See “Note 6. Discontinued Operations” for more information.

The fair value assigned to goodwill is primarily attributable to buyer-specific synergies expected to arise after the acquisition (e.g., enhanced geographic reach of the combined organization, increased vertical integration and other synergistic opportunities), the assembled work force of MWV as well as due to establishing deferred tax liabilities for the assets and liabilities acquired. The goodwill and intangibles resulting from the acquisition will not be amortizable for tax purposes.

The following table summarizes the weighted average life and gross carrying amount relating to intangible assets recognized in the Combination, excluding goodwill (in millions):
 
 
Weighted Avg. Life
 
Gross Carrying Amount
Customer relationships
 
19.2
 
$
2,881.7

Patents
 
9.8
 
57.2

Trademarks
 
4.5
 
52.9

Favorable contracts
 
8.2
 
2.4

Total
 
18.8
 
$
2,994.2


None of the intangibles has significant residual value. The intangibles are expected to be amortized over estimated useful lives ranging from 1 to 20 years based on the approximate pattern in which the economic benefits are consumed or straight-line if the pattern was not reliably determinable.

The allocation of the consideration for the Combination also includes, among other things, $38.5 million of unfavorable contracts that will be amortized over 1 to 9 years. In connection with purchase accounting, we increased the carrying value of the debt assumed by $364.5 million to increase the carrying value of the debt assumed to fair value, including $18.3 million in the third quarter of fiscal 2016. The fair value adjustment will be amortized over 1 to 32 years.

The following unaudited pro forma information reflects our condensed consolidated results of operations as if the Combination had taken place on October 1, 2013. The unaudited pro forma information is not necessarily indicative of the results of operations that we would have reported had the transaction actually occurred at the beginning of these periods nor is it necessarily indicative of future results. The unaudited pro forma financial information does not reflect the impact of future events that may occur after the Combination, including, but not limited to, anticipated costs savings from synergies or other operational improvements. The net sales have been adjusted to reflect the discontinued operations of the Specialty Chemicals business.
 
Three Months Ended June 30, 2015
 
Nine Months Ended June 30, 2015
 
(Unaudited, in millions)
Net sales
$
3,654.3

 
$
10,730.9

Net income attributable to common stockholders
$
188.2

 
$
483.1



The unaudited pro forma financial information presented in the table above has been adjusted to give effect to adjustments that are (1) directly related to the business combination; (2) factually supportable; and (3) expected to have a continuing impact. These adjustments include, but are not limited to, the application of our accounting policies; elimination of related party transactions; depreciation and amortization related to fair value adjustments to property, plant and equipment and intangible assets including contracts assumed; and interest expense on acquisition related debt.

Unaudited pro forma earnings for three and nine months ended June 30, 2015 were adjusted to exclude $17.4 million and $42.5 million, respectively, of acquisition costs, which primarily consist of advisory, legal, accounting, valuation and other professional or consulting fees.
Discontinued Operations (Notes)
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
Discontinued Operations

On May 15, 2016 WestRock distributed 100% of the outstanding common stock, par value $0.01 per share, of Ingevity to WestRock’s shareholders of record as of the close of business on May 4, 2016 receiving one share of Ingevity common stock for every six shares of WestRock Common Stock held as of such record date, and completed the Separation. Following the Separation, we do not beneficially own any shares of Ingevity common stock and Ingevity is now an independent public company trading under the symbol “NGVT” on the New York Stock Exchange. We disposed of the former Specialty Chemicals segment in its entirety and ceased to consolidate its assets, liabilities and results of operations in our Condensed Consolidated Financial Statements. Accordingly, we have presented the financial position and results of operations of our former Specialty Chemicals segment as discontinued operations in the accompanying Condensed Consolidated Financial Statements for all periods presented.

In connection with the Separation, we and Ingevity have entered into a separation and distribution agreement as well as various other agreements that provide a framework for the relationships between the parties going forward, including among others a tax matters agreement, a lease and ground service agreement with respect to our Covington, Virginia facility, an intellectual property agreement, a crude tall oil and black liquor soap skimming supply agreement, a trust agreement, an employee matters agreement and a transition service agreement. These agreements provided for the allocation between us and Ingevity of assets, employees, liabilities and obligations attributable to periods prior to, at and after the Separation and govern certain relationships between us and Ingevity after the Separation.

Prior to the Separation, Ingevity (then a subsidiary of WestRock) borrowed $500.0 million in contemplation of the Separation. In connection with the Separation, based on current market rates at the time of the Separation, we have recorded a $108.2 million long-term asset for the estimated fair value of the future principal and interest payments on an $80.0 million, 7.67% capital lease obligation assumed by Ingevity that is owed to the city of Wickliffe, KY. In contemplation of the Separation, Ingevity funded a trust in the amount of $68.9 million to secure the principal payment of the capital lease upon its maturity on January 15, 2027. We are co-obligors on the capital lease and the associated obligation remains recorded in long-term debt. The $500.0 million of debt and the $68.9 million in the trust were assumed by Ingevity, and removed from our Condensed Consolidated Financial Statements as part of our discontinued operations reporting.

The following table presents the financial results of Specialty Chemicals’ discontinued operations (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30, 2016
 
June 30, 2016
Net sales
$
120.0

 
$
533.7

Cost of goods sold
83.8

 
387.5

Gross Profit
36.2

 
146.2

Selling, general and administrative, excluding intangible amortization
11.8

 
65.6

Selling, general and administrative intangible amortization
5.9

 
28.8

Restructuring and other costs, net

22.5

 
50.9

Impairment of Specialty Chemicals goodwill and intangibles
101.1

 
579.4

Operating loss
(105.1
)
 
(578.5
)
Interest income (expense) and other income (expense), net
0.2

 
0.1

Loss from discontinued operations before income taxes
(104.9
)
 
(578.4
)
Income tax benefit
46.2

 
39.0

Loss from discontinued operations

$
(58.7
)
 
$
(539.4
)


Restructuring and other costs, net are primarily associated with costs incurred to support the Separation and consist primarily of advisory, legal, accounting and other professional fees. Additionally, restructuring and other costs, net include $10.0 million of costs associated with the closure of Ingevity’s Duque de Caxias facility in Brazil and other severance and stock-based compensation expenses.

In the first quarter of fiscal 2016, as part of our evaluation of whether events or changes in circumstances had occurred that would indicate whether it was more likely than not that the goodwill of our then-owned Specialty Chemicals reporting unit was impaired, we considered factors such as, but not limited to, macroeconomic conditions, industry and market considerations, and financial performance, including the planned revenue and earnings of the reporting unit. We concluded that an impairment indicator had occurred related to the goodwill of the Specialty Chemicals reporting unit and that the indicator was driven by market factors subsequent to the purchase price allocation to the Specialty Chemical’s reporting unit.

We performed a “Step 1” goodwill impairment test where we updated the discounted cash flow analysis used to determine the reporting unit’s initial fair value on July, 1 2015. We also compared those results to the valuations performed by our investment bankers in connection with the planned separation of our Specialty Chemicals business. Based on the results of the impairment test and analysis, we concluded that the fair value of the Specialty Chemicals reporting unit was less than its carrying amount and began a “Step 2” goodwill impairment test to determine the amount of impairment loss, if any. As part of the analysis, we determined that the carrying value of the property, plant and equipment and intangibles, all of which have finite lives, on a “held and used” basis did not exceed the estimated undiscounted future cash flows.

In light of changing market conditions, expected revenue and earnings of the reporting unit, lower comparative market valuations for companies in Specialty Chemicals’ peer group and our preliminary “Step 2” test, we concluded that an impairment of the Specialty Chemicals reporting unit was probable and could be reasonably estimated. As a result, we recorded a pre-tax and after-tax non-cash goodwill impairment charge of $478.3 million. This amount is included in the line item “Loss from discontinued operations” in the Condensed Consolidated Statements of Operations. No tax benefit was recorded for the goodwill impairment.

Until the completion of the Separation, GAAP required us to assess impairment of the Specialty Chemicals’ long-lived assets using the “held and used” model which is based on undiscounted future cash flows. Under this model, if the expected cash flows over the life of the primary asset of the reporting unit were in excess of the carrying amount, then there would be no impairment. At the date of the Separation, GAAP required us to assess impairment using the “held for sale” model. This model compares the fair value of the disposal unit to its carrying value and if the fair value less cost to sell is lower, then an impairment loss would be recorded. At the date of the Separation, we evaluated our intangibles, which consisted predominantly of customer list intangibles for impairment. Our analysis at May 15, 2016, using the income approach (multi-period excess earnings method), indicated that there was a $101.1 million pre-tax non-cash impairment of our Specialty Chemicals customer relationships intangible. The impairment loss was recorded on the Separation and is included as a component of discontinued operations.

The following table presents the significant non-cash items and capital expenditures for Specialty Chemicals’ that are included in the nine months ended June 30, 2016 Condensed Consolidated Statements of Cash Flows (in millions):
 
Nine Months Ended
 
June 30, 2016
Depreciation, depletion and amortization
$
57.2

Impairment of Specialty Chemicals goodwill and intangibles
$
579.4

Capital expenditures
$
(43.9
)

The carrying value of the assets and liabilities of discontinued operations on the Condensed Consolidated Balance Sheet as of September 30, 2015 were as follows (in millions):
 
September 30,
2015
ASSETS
Cash and cash equivalents
$
20.5

Accounts receivable (net of allowance of $0.1)
114.6

Inventories
202.4

Other current assets
25.3

Total current assets of discontinued operations
$
362.8

 
 
Property, plant and equipment, net
436.9

Goodwill
1,047.4

Intangibles, net
757.3

Other non-current assets
14.1

Total non-current assets of discontinued operations
$
2,255.7

 
 
LIABILITIES
Current portion of debt
10.4

Accounts payable
72.4

Accrued compensation and benefits
3.1

Other current liabilities
32.7

Total current liabilities of discontinued operations

$
118.6

 
 
Long-term debt due after one year
0.1

Deferred income taxes
350.9

Other non-current liabilities
10.8

Total non-current liabilities of discontinued operations

$
361.8



Restructuring and Other Costs, Net
Restructuring and Other Costs, Net
Restructuring and Other Costs, Net

Summary of Restructuring and Other Initiatives

We recorded pre-tax restructuring and other costs, net, of $43.1 million and $13.1 million for the three months ended June 30, 2016 and June 30, 2015, respectively, and recorded pre-tax restructuring and other costs, net, of $317.0 million and $35.7 million for the nine months ended June 30, 2016 and June 30, 2015, respectively. These amounts are not comparable since the timing and scope of the individual actions associated with a restructuring, acquisition or integration can vary. The restructuring and other costs, net, exclude the Specialty Chemicals costs which are included in discontinued operations. We discuss our restructuring and other costs, net in more detail below and those charged to discontinued operations in “Note 6. Discontinued Operations”.

When we close a facility, if necessary, we recognize an impairment charge primarily to reduce the carrying value of equipment or other property to their estimated fair value less cost to sell, and record charges for severance and other employee related costs. Any subsequent change in fair value less cost to sell prior to disposition is recognized as identified; however, no gain is recognized in excess of the cumulative loss previously recorded. At the time of each announced closure, we generally expect to record future charges for equipment relocation, facility carrying costs, costs to terminate a lease or contract before the end of its term and other employee related costs. Although specific circumstances vary, our strategy has generally been to consolidate our sales and operations into large well-equipped plants that operate at high utilization rates and take advantage of available capacity created by operational excellence initiatives. Therefore, we have transferred a substantial portion of each plant’s assets and production to our other plants. We believe these actions have allowed us to more effectively manage our business.

While restructuring costs are not charged to our segments and, therefore, do not reduce segment income, we highlight the segment to which the charges relate. The following table presents a summary of restructuring and other charges, net, related to active restructuring and other initiatives that we incurred during the three and nine months ended June 30, 2016 and June 30, 2015, the cumulative recorded amount since we started the initiative, and our estimate of the total we expect to incur (in millions):

Summary of Restructuring and Other Costs, Net
Segment
 
Period
 
Net Property,
Plant and
Equipment (1)
 
Severance
and Other
Employee
Related
Costs
 
Equipment
and Inventory
Relocation
Costs
 
Facility
Carrying
Costs
 
Other
Costs
 
Total
Corrugated
Packaging(2)
 
Current Qtr.
 
$
1.4

 
$
0.4

 
$
—

 
$
3.4

 
$
0.4

 
$
5.6

 
YTD Fiscal 2016
 
181.3

 
15.6

 
0.3

 
15.9

 
8.8

 
221.9

 
Prior Year Qtr.
 
(2.5
)
 
0.2

 
0.4

 
0.6

 
0.1

 
(1.2
)
 
YTD Fiscal 2015
 
(0.9
)
 
0.2

 
0.8

 
2.5

 
1.2

 
3.8

 
Cumulative
 
223.2

 
45.1

 
8.0

 
30.8

 
22.4

 
329.5

 
Expected Total
 
223.2

 
45.1

 
8.7

 
33.3

 
23.8

 
334.1

Consumer Packaging(3)
 
Current Qtr.
 
1.5

 
3.4

 
0.4

 
0.1

 
—

 
5.4

 
YTD Fiscal 2016
 
(0.5
)
 
4.0

 
0.9

 
0.5

 
—

 
4.9

 
Prior Year Qtr.
 
0.1

 
0.6

 
(0.1
)
 
0.4

 
—

 
1.0

 
YTD Fiscal 2015
 
0.4

 
0.8

 
0.1

 
0.6

 
0.2

 
2.1

 
Cumulative
 
5.0

 
7.4

 
1.9

 
1.7

 
0.5

 
16.5

 
Expected Total
 
5.0

 
7.7

 
2.6

 
1.7

 
0.5

 
17.5

Other(4)
 
Current Qtr.
 
—

 
—

 
—

 
—

 
32.1

 
32.1

 
YTD Fiscal 2016
 
1.2

 
0.9

 
—

 
—

 
88.1

 
90.2

 
Prior Year Qtr.
 
—

 
—

 
—

 
—

 
13.3

 
13.3

 
YTD Fiscal 2015
 
—

 
—

 
—

 
—

 
29.8

 
29.8

 
Cumulative
 
1.2

 
0.9

 
—

 
—

 
362.2

 
364.3

 
Expected Total
 
1.2

 
0.9

 
—

 
—

 
362.2

 
364.3

Total
 
Current Qtr.
 
$
2.9

 
$
3.8

 
$
0.4

 
$
3.5

 
$
32.5

 
$
43.1

 
YTD Fiscal 2016
 
$
182.0

 
$
20.5

 
$
1.2

 
$
16.4

 
$
96.9

 
$
317.0

 
Prior Year Qtr.
 
$
(2.4
)
 
$
0.8

 
$
0.3

 
$
1.0

 
$
13.4

 
$
13.1

 
YTD Fiscal 2015
 
$
(0.5
)
 
$
1.0

 
$
0.9

 
$
3.1

 
$
31.2

 
$
35.7

 
Cumulative
 
$
229.4

 
$
53.4

 
$
9.9

 
$
32.5

 
$
385.1

 
$
710.3

 
Expected Total
 
$
229.4

 
$
53.7

 
$
11.3

 
$
35.0

 
$
386.5

 
$
715.9


(1) 
We have defined “Net Property, Plant and Equipment” as used in this Note 7 to represent property, plant and equipment impairment losses, subsequent adjustments to fair value for assets classified as held for sale, subsequent (gains) or losses on sales of property, plant and equipment and related parts and supplies, and accelerated depreciation on such assets, if any.

(2) 
The Corrugated Packaging segment current quarter charges primarily reflect restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with the permanent closures of the Coshocton, OH and Uncasville, CT medium mills, the Newberg, OR containerboard and newsprint mill, the Vapi, India linerboard mill, restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The prior year quarter and prior year to date charges primarily reflect on-going closure costs at previously closed facilities net of asset sales. The cumulative charges are primarily associated with the closure of the Coshocton, Uncasville, Newberg, Vapi and Matane, Quebec mills, a recycling facility and the cumulative closure of certain corrugated container plants and recycled collection facilities acquired in the Smurfit-Stone Acquisition, and gains and losses associated with the sale of closed facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.

(3) 
The Consumer Packaging segment current quarter charges primarily reflect the charges associated with a folding carton and merchandising displays facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with a folding carton and merchandising displays facility, on-going closure costs at previously closed facilities that were partially offset by the gain on sale of the Cincinnati, OH specialty recycled paperboard mill. The prior year quarter and prior year to date charges are primarily associated with on-going closure activity at previously closed facilities including the Cincinnati, OH mill. The cumulative charges primarily reflect our Cincinnati, OH mill and the consolidation of converting and merchandising displays facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.

(4) The expenses in the “Other” segment primarily reflect costs that we consider as related to Corporate that primarily consist of costs incurred as a result of the Combination, the Smurfit-Stone Acquisition, and other acquisition and divestiture expenses, excluding the Specialty Chemicals costs which are included in discontinued operations. The charges in the Net Property, Plant and Equipment column are for the write-off of leasehold improvements associated with the integration of the Combination. The pre-tax charges in the “Other” segment are summarized below (in millions):

 
Acquisition
Expenses
 
Integration
Expenses
 
Other Expenses
 
Total
Current Qtr.
$
1.4

 
$
30.3

 
$
0.4

 
$
32.1

YTD Fiscal 2016
$
6.9

 
$
82.0

 
$
1.3

 
$
90.2

Prior Year Qtr.
$
2.2

 
$
11.1

 
$
—

 
$
13.3

YTD Fiscal 2015
$
13.0

 
$
16.8

 
$
—

 
$
29.8



Acquisition expenses include expenses associated with mergers, acquisitions and other business combinations, whether consummated or not, as well as litigation expenses associated with mergers, acquisitions and business combinations, net of recoveries. Acquisition expenses primarily consist of advisory, legal, accounting, valuation and other professional or consulting fees. Integration expenses reflect primarily severance and other employee costs, professional services including work being performed to facilitate merger and acquisition integration, such as information systems integration costs, lease expense and other costs. Due to the complexity and duration of the integration activities associated with the Combination, the precise amount expected to be incurred has not been quantified in the “Expected Total” in the Summary of Restructuring and Other Costs, Net table above. We expect integration activities to continue during fiscal 2016 and 2017.

The following table represents a summary of and the changes in the restructuring accrual, which is primarily composed of lease commitments, accrued severance and other employee costs, and a reconciliation of the restructuring accrual charges to the line item “Restructuring and other costs, net” on our Condensed Consolidated Statements of Operations (in millions):
 
Nine Months Ended
 
June 30,
 
2016
 
2015
Accrual at beginning of fiscal year
$
21.4

 
$
10.9

Additional accruals
57.1

 
0.9

Payments
(41.0
)
 
(6.5
)
Adjustment to accruals
0.1

 
0.8

Accrual at June 30
$
37.6

 
$
6.1


Reconciliation of accruals and charges to restructuring and other costs, net (in millions):
 
 
 
Nine Months Ended
 
June 30,
 
2016
 
2015
Additional accruals and adjustments to accruals (see table above)
$
57.2

 
$
1.7

Acquisition expenses
6.9

 
13.0

Integration expenses
50.0

 
16.9

Net property, plant and equipment
182.0

 
(0.5
)
Severance and other employee expense
2.9

 
0.4

Equipment and inventory relocation costs
1.2

 
0.9

Facility carrying costs
16.4

 
3.1

Other expense
0.4

 
0.2

Total restructuring and other costs, net
$
317.0

 
$
35.7

Income Taxes
Tax Provision
Income Taxes

The effective tax rates from continuing operations for the three and nine months ended June 30, 2016 were 39.5% and 39.7%, respectively. The effective tax rates from continuing operations for the three and nine months ended June 30, 2015 were 35.9% and 34.4%, respectively. The effective tax rate from continuing operations for the three and nine months ended June 30, 2016 were different than the statutory rate primarily due to the impact of state taxes, the domestic manufacturer’s deduction, no tax benefit being recorded for the non-deductible goodwill disposed of in connection with the contribution to the Grupo Gondi joint venture, the exclusion of tax benefits related to certain foreign losses and a tax rate differential with respect to foreign earnings primarily in Canada. The effective tax rates from continuing operations for the three and nine months ended June 30, 2015 were different than the statutory rate primarily due to the impact of state taxes, the domestic manufacturer’s deduction and a lower tax rate with respect to foreign earnings primarily in Canada. The three months ended June 30, 2015 also included charges related to a return to provision true-up.
Inventories
Inventories
Inventories

We value substantially all of our U.S. inventories at the lower of cost or market, with cost determined on the LIFO inventory valuation method, which we believe generally results in a better matching of current costs and revenues than under the FIFO inventory valuation method. In periods of increasing costs, the LIFO method generally results in higher cost of goods sold than under the FIFO method. In periods of decreasing costs, the results are generally the opposite. Since LIFO is designed for annual determinations, it is possible to make an actual valuation of inventory under the LIFO method only at the end of each fiscal year based on the inventory levels and costs at that time. Accordingly, we base interim LIFO estimates on management’s projection of expected year-end inventory levels and costs. We value all other inventories at the lower of cost or market, with cost determined using methods which approximate cost computed on a FIFO basis. These other inventories represent primarily foreign inventories and certain inventoried spare parts and supplies inventories. Inventories were as follows (in millions):
 
June 30,
2016
 
September 30,
2015
Finished goods and work in process
$
837.0

 
$
859.7

Raw materials
547.1

 
652.3

Spare parts and supplies
340.9

 
322.4

Inventories at FIFO cost
1,725.0

 
1,834.4

LIFO reserve
(33.9
)
 
(73.4
)
Net inventories
$
1,691.1

 
$
1,761.0

Property, Plant and Equipment
Property, Plant and Equipment Disclosure [Text Block]
Property, Plant and Equipment

Property, plant and equipment, net consists of the following (in millions):    
 
June 30,
2016
 
September 30,
2015
Property, plant and equipment at cost:
 
 
 
Land and buildings
$
2,295.9

 
$
2,245.2

Machinery and equipment
10,540.1

 
9,712.4

Forestlands and mineral rights
202.1

 
161.3

Transportation equipment
26.2

 
20.2

Leasehold improvements
62.9

 
59.1

 
13,127.2

 
12,198.2

Less accumulated depreciation and amortization
(3,782.0
)
 
(3,038.4
)
Property, plant and equipment, net
$
9,345.2

 
$
9,159.8

Debt
Debt Disclosure
Debt

In connection with the Combination, the public bonds previously issued by WestRock RKT Company and WestRock MWV, LLC are guaranteed by WestRock and have cross-guarantees between the two companies. The IDBs associated with the capital lease obligations of WestRock MWV, LLC are guaranteed by WestRock. The public bonds are unsecured unsubordinated obligations that rank equally in right of payment with all of our existing and future unsecured unsubordinated obligations. At June 30, 2016, our Credit Facility and public bonds were unsecured. For more information regarding certain of our debt characteristics, see “Note 9. Debt” of the Notes to Consolidated Financial Statements section of the Fiscal 2015 Form 10-K.

The following were individual components of debt (in millions):
 
June 30, 2016
 
September 30, 2015
 
Carrying Value
 
Weighted Avg. Interest Rate
 
Carrying Value
 
Weighted Avg. Interest Rate
U.S. Dollar Denominated Fixed Rate Debt:
 
 
 
 
 
 
 
Public bonds due fiscal 2017 to 2022
$
1,656.3

 
3.9
%
 
$
1,672.2

 
3.8
%
Public bonds due fiscal 2023 to 2027
414.6

 
4.3
%
 
436.8

 
4.4
%
Public bonds due fiscal 2030 to 2033
991.3

 
4.7
%
 
1,002.8

 
4.6
%
Public bonds due fiscal 2037 to 2047
179.4

 
5.9
%
 
180.1

 
5.9
%
 
 
 
 
 
 
 
 
U.S. Dollar Denominated Floating Rate Debt:
 
 
 
 
 
 
 
Term loan facilities
2,195.5

 
1.7
%
 
1,794.7

 
1.4
%
Revolving credit and swing facilities
62.9

 
1.1
%
 
64.1

 
2.6
%
Receivables-backed financing facility
—

 
—

 
198.0

 
0.9
%
 
 
 
 
 
 
 
 
Capital lease obligations
185.1

 
4.2
%
 
165.8

 
5.7
%
 
 
 
 
 
 
 
 
Supplier Financing and Commercial Card Programs
104.5

 
—

 
3.2

 
—

 
 
 
 
 
 
 
 
International and other debt
69.5

 
8.1
%
 
104.2

 
7.4
%
Total debt
5,859.1

 
3.2
%
 
5,621.9

 
3.3
%
Less current portion of debt
345.2

 
 
 
63.7

 
 
Long-term debt due after one year
$
5,513.9

 
 
 
$
5,558.2

 
 

Total debt at June 30, 2016 and September 30, 2015 includes unamortized fair market value step-up of $329.4 million and $340.9 million, respectively. A portion of the debt classified as long-term, principally our Credit Facility and Receivables Facility, may be paid down earlier than scheduled at our discretion without penalty. Certain restrictive covenants govern our maximum availability under our credit facilities. We test and report our compliance with these covenants as required and were in compliance with all of our covenants at June 30, 2016. At June 30, 2016, we had $111.5 million of outstanding letters of credit not drawn upon. At June 30, 2016, we had approximately $2.5 billion of availability under our committed credit facilities and approximately $0.4 billion available under our uncommitted credit facilities. This liquidity may be used to provide for ongoing working capital needs and for other general corporate purposes, including acquisitions, dividends and stock repurchases. The estimated fair value of our debt was approximately $6.0 billion and $5.7 billion as of June 30, 2016 and September 30, 2015, respectively. The fair value of our long-term debt is primarily either based on quoted prices for those or similar instruments, or approximate the carrying amount as the variable interest rates reprice frequently at observable current market rates, and are categorized as level 2 within the fair value hierarchy.

Term Loans and Revolving Credit Facilities

In connection with the Combination, on July 1, 2015, WestRock entered into a credit agreement (the “Credit Agreement”) that provides for a 5-year senior unsecured term loan in an aggregate principal amount of $2.3 billion ($1.1 billion of which was previously available to be drawn on a delayed draw basis not later than April 1, 2016 in up to two separate draws) and a 5-year senior unsecured revolving credit facility in an aggregate committed principal amount of $2.0 billion (together the “Credit Facility”). On March 24, 2016, we drew $600.0 million of the available $1.1 billion delayed draw term loan facility for general corporate purposes and the balance of the delayed draw term loan facility was terminated. On June 22, 2016, we pre-paid $200.0 million of amortization payments through the second quarter of fiscal 2018. Our next amortization payment will be due in June 2018. On July 1, 2016, we executed an option to extend the term of the Credit Facility for one year beyond the original 5-year term. Approximately $1.82 billion of the original $2.0 billion aggregate committed principal amount has been extended to July 1, 2021, and the remainder will continue to mature on July 1, 2020.

On July 1, 2015, we entered into a credit agreement (the “Farm Loan Credit Agreement”) with CoBank ACB. The Farm Loan Credit Agreement provides for a 7-year senior unsecured term loan in an aggregate principal amount of $600 million. At June 30, 2016, there was $600.0 million outstanding under this facility.

On December 1, 2015, we entered into a $200 million uncommitted and revolving line of credit with Sumitomo Mitsui Banking Corporation. The facility matures on December 1, 2016. At June 30, 2016, there was $62.9 million outstanding under this facility.

On February 11, 2016, we entered into a $100 million uncommitted and revolving line of credit with the Bank of Tokyo-Mitsubishi UFJ, LTD. The facility matures on February 9, 2017. At June 30, 2016, we had no amounts outstanding under this facility.

On March 4, 2016, we entered into a $100 million uncommitted and revolving line of credit with Cooperatieve Rabobank U.A., New York Branch. The facility matures on March 2, 2017. At June 30, 2016, we had no amounts outstanding under this facility.
 
Receivables-Backed Financing Facility

We have a $700.0 million Receivables Facility and on July 22, 2016 we executed an agreement to extend the maturity of this facility from October 24, 2017 to July 22, 2019. At June 30, 2016 and September 30, 2015, maximum available borrowings, excluding amounts outstanding under the Receivables Facility, were approximately $512.9 million and $555.4 million, respectively. The carrying amount of accounts receivable collateralizing the maximum available borrowings at June 30, 2016 was approximately $732.9 million. We have continuing involvement with the underlying receivables as we provide credit and collections services pursuant to the securitization agreement. At June 30, 2016, we had no amounts outstanding under this facility.
Fair Value
Fair Value
Fair Value

Assets and Liabilities Measured or Disclosed at Fair Value

We estimate fair values in accordance with ASC 820 “Fair Value Measurement”. ASC 820 provides a framework for measuring fair value and expands disclosures required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value and a hierarchy prioritizing the inputs to valuation techniques. ASC 820 defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Additionally, ASC 820 defines levels within the hierarchy based on the availability of quoted prices for identical items in active markets, similar items in active or inactive markets and valuation techniques using observable and unobservable inputs. We incorporate credit valuation adjustments to reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in our fair value measurements.

We disclose the fair value of our pension and postretirement assets and liabilities in “Note 13. Retirement Plans” of the Notes to Consolidated Financial Statements section of the Fiscal 2015 Form 10-K and the fair value of our long-term debt in “Note 11. Debt” herein. We have, or from time to time may have, various assets or liabilities whose fair value are not significant, such as supplemental retirement savings plans that are nonqualified deferred compensation plans pursuant to which assets are invested primarily in mutual funds, interest rate derivatives, commodity derivatives or other similar classes of assets or liabilities.

Accounts Receivable Sales Agreement        

In fiscal 2014, we entered into an agreement (the “A/R Sales Agreement”) to sell to a third party financial institution all of the short term receivables generated from certain customer trade accounts, on a revolving basis, until the agreement is terminated by either party. Transfers under this agreement meet the requirements to be accounted for as sales in accordance with the “Transfers and Servicing” guidance in ASC 860. Subsequently, on February 27, 2015, the A/R Sales Agreement was amended to increase the maximum amount of receivables to $300.0 million. On June 27, 2016, the A/R Sales Agreement was amended to increase the maximum amount of receivables to $400.0 million.

The following table represents a summary of the activity under the A/R Sales Agreement for the nine months ended June 30, 2016 and June 30, 2015 (in millions):

 
Nine Months Ended
 
June 30,
 
2016
 
2015
Receivable from financial institution at beginning of fiscal year
$
5.8

 
$
10.4

Receivables sold to the financial institution and derecognized
1,095.1

 
897.6

Receivables collected by financial institution
(987.0
)
 
(797.2
)
Cash proceeds from financial institution
(97.2
)
 
(66.4
)
Receivable from financial institution at June 30,
$
16.7

 
$
44.4



Cash proceeds related to receivables sold are included in cash from operating activities in the condensed consolidated statement of cash flows in the accounts receivable line item. The loss on sale is not material as it is currently less than 1% per annum of the receivables sold, and is recorded in interest income and other income (expense), net. Although the sales are made without recourse, we maintain continuing involvement with the sold receivables as we provide collections services related to the transferred assets. The associated servicing liability is not material given the high quality of the customers underlying the receivables and the anticipated short collection period.

Financial Instruments Not Recognized at Fair Value

Financial instruments not recognized at fair value on a recurring or nonrecurring basis include cash and cash equivalents, accounts receivable, certain other current assets, short-term debt, accounts payable, certain other current liabilities, and long-term debt. With the exception of long-term debt, the carrying amounts of these financial instruments approximate their fair values due to their short maturities.

Fair Value of Nonfinancial Assets and Nonfinancial Liabilities

We measure certain nonfinancial assets and liabilities at fair value on a nonrecurring basis. These assets and liabilities include cost and equity method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property, plant and equipment and intangible assets that are written down to fair value when they are held for sale or determined to be impaired. During the three and nine months ended June 30, 2016 and June 30, 2015, we did not have any significant nonfinancial assets or nonfinancial liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition other than the goodwill impairment of our Specialty Chemicals reporting unit in the first quarter of fiscal 2016 and the intangible impairment in the Specialty Chemicals segment in the third quarter of fiscal 2016 following the separation, each as discussed in “Note 6. Discontinued Operations”.
Retirement Plans
Retirement Plans
Retirement Plans

We have defined benefit pension plans and other postretirement plans for certain U.S. and non-U.S. employees. These plans were frozen for salaried and non-union hourly employees at various times in the past, although some employees meeting certain criteria are still accruing benefits. In addition, under several labor contracts, we make payments, based on hours worked, into multiemployer pension plan trusts established for the benefit of certain collective bargaining employees in facilities both inside and outside the U.S. We also have supplemental executive retirement plans and other non-qualified defined benefit pension plans that provide unfunded supplemental retirement benefits to certain of our current and former executives. The supplemental executive retirement plans provide for incremental pension benefits in excess of those offered in our principal pension plan. The postretirement plans provide certain health care and life insurance benefits for certain salaried and hourly employees who meet specified age and service requirements as defined by the plans. For more information regarding our retirement plans, see “Note 13. Retirement Plans” of the Notes to Consolidated Financial Statements section of the Fiscal 2015 Form 10-K.

The following table represents a summary of the components of net pension (benefit) cost (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Service cost
$
8.2

 
$
7.0

 
$
41.7

 
$
22.6

Interest cost
78.2

 
45.1

 
232.9

 
141.5

Expected return on plan assets
(103.3
)
 
(61.3
)
 
(309.3
)
 
(187.6
)
Amortization of net actuarial loss
2.9

 
10.0

 
8.2

 
27.1

Amortization of prior service cost
1.0

 
0.9

 
2.9

 
2.0

Curtailment gain recognized
—

 
—

 
(1.0
)
 
—

Settlement loss recognized
—

 
—

 
—

 
20.0

Company defined benefit plan (benefit) cost
(13.0
)
 
1.7

 
(24.6
)
 
25.6

Multiemployer and other plans
1.6

 
1.5

 
4.4

 
4.3

Net pension (benefit) cost
$
(11.4
)
 
$
3.2

 
$
(20.2
)
 
$
29.9


During the three and nine months ended June 30, 2016, we made contributions of $14.3 million and $39.9 million to our qualified and supplemental defined benefit pension plans. During the three and nine months ended June 30, 2015, we made contributions of $72.9 million and $131.1 million to our qualified and supplemental defined benefit pension plans.

During the first quarter of fiscal 2015, we partially settled obligations of one of our defined benefit pension plans through lump sum payments to certain eligible former employees who were not receiving a monthly benefit. Eligible former employees whose present value of future pension benefits exceeded a certain minimum threshold had the option to either voluntarily accept lump sum payments or to not accept the offer and continue to be entitled to their monthly benefit upon retirement. Former employees with an aggregate pension benefit obligation of $163.7 million accepted the offer. Lump sum payments of $135.1 million were made out of existing plan assets. The settlement resulted in a gain of $28.6 million that was more than offset by the loss on remeasurement of the pension benefit obligation of approximately $32.5 million due primarily to the impact of a lower discount rate and mortality table changes. As a result, we recorded a net $3.9 million loss to other comprehensive (loss) income. The settlement also resulted in a $20.0 million pre-tax non-cash charge to earnings in the first quarter of fiscal 2015, which is included in the line item “Pension lump sum settlement and retiree medical curtailment, net” on our Condensed Consolidated Statements of Operations. The impact of the settlement is included in the net periodic pension cost table above. As a result of the remeasurement, the pension benefit obligation increased $22.1 million due to changes in coverage for certain employees covered by the United Steelworkers master agreement as discussed below, with an offset recorded to the unrecognized prior service cost component of other comprehensive (loss) income.

The postretirement benefit plans provide certain health care and life insurance benefits for certain salaried and hourly employees who meet specified age and service requirements as defined by the plans. The following table represents a summary of the components of the postretirement benefits costs (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Service cost
$
0.4

 
$
0.1

 
$
1.7

 
$
0.4

Interest cost
1.9

 
1.1

 
6.0

 
3.2

Amortization of net actuarial gain
(0.8
)
 
(0.2
)
 
(1.4
)
 
(0.8
)
Amortization of prior service credit
(0.5
)
 
(0.4
)
 
(1.5
)
 
(1.4
)
Curtailment gain recognized
—

 
(0.4
)
 
—

 
(8.5
)
Postretirement plan cost (benefit)
$
1.0

 
$
0.2

 
$
4.8

 
$
(7.1
)


During the three and nine months ended June 30, 2016, we funded an aggregate of $2.2 million and $9.3 million respectively, to our postretirement benefit plans. During the three and nine months ended June 30, 2015, we funded an aggregate of $2.3 million and $8.0 million, respectively, to our postretirement benefit plans.

In October 2014, we entered into a master agreement with the United Steelworkers Union that applied to substantially all of our legacy RockTenn facilities represented by the union at that time. The agreement has a six year term and covers a number of specific items, including wages, medical coverage and certain other benefit programs. Individual facilities will continue to have local agreements for subjects not covered by the master agreement and those agreements will continue to have staggered terms. During the first quarter of fiscal 2015, changes in retiree medical coverage for certain employees covered by the United Steelworkers master agreement resulted in the recognition of an estimated $8.1 million pre-tax non-cash curtailment gain included in the line item “Pension lump sum settlement and retiree medical curtailment, net” on our Condensed Consolidated Statements of Operations which was subsequently adjusted in the third quarter of fiscal 2015 to $8.5 million. The aggregate postretirement benefit obligation decreased $0.6 million as a result of the curtailment.
Share-Based Compensation
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
Stock-Based Compensation

Stock-based Compensation Plans

At our Annual Meeting of Stockholders held on February 2, 2016, our stockholders approved the 2016 Incentive Stock Plan and ESPP. The 2016 Incentive Stock Plan allows for the granting of options and restricted stock, stock appreciation rights and restricted stock units to certain key employees and directors for the issuance of approximately 9.6 million shares of Common Stock. Adjusted for the Separation as discussed below, at June 30, 2016, approximately 7.9 million shares remained available for future grants. If all currently outstanding adjustable restricted stock awards recorded at target achieve the maximum award, shares available for future grant would be reduced by approximately 1.3 million additional shares. The ESPP provides for the purchase of shares by all of our eligible employees at a 15% discount and allows for the purchase of a total of approximately 2.5 million shares of Common Stock.

As part of the Separation, equity-based incentive awards were generally adjusted to maintain the intrinsic value of awards immediately prior to the Separation. The number of unvested restricted stock awards and unexercised stock options and SARs at the time of the Separation were increased by an exchange factor of approximately 1.12. In addition, the exercise price of unexercised stock options and SARs at the time of the separation was converted to decrease the exercise price by an exchange factor of approximately 1.12. The share increases are reflected in the tables below on the line item “Adjustments due to Separation”. The weighted-average grant date fair value of adjustments is equal to the weighted-average grant date fair value of the awards outstanding at the date of the Separation at their respective grant date divided by a factor of approximately 1.12, and the weighted-average grant date fair value of the unvested restricted stock as of June 30, 2016 reflects the adjustments.
 
Stock Options

Options granted under our plans generally have an exercise price equal to the closing market price on the date of grant, generally vest in three years, in either one tranche or in approximately one-third increments, and have 10-year contractual terms. However, a portion of our grants are subject to earlier expense recognition due to retirement eligibility rules. Our option grants provide for accelerated vesting if there is a change in control (as defined in the applicable plan). However, the Compensation Committee of the board of directors has determined that effective with the fiscal 2013 grants, other than in circumstances such as death and disability, grants will include a provision requiring both a change of control and termination of employment to accelerate vesting.

During the nine months ended June 30, 2016, we granted options to purchase 1,249,790 shares of Common Stock to certain employees. These grants were valued at a weighted average fair value of $8.06 per share using the Black-Scholes option pricing model. The approximate assumptions used were: an expected term of 7.0 years; an expected volatility of 38.3%; expected dividends of 4.5%; and a risk free rate of 1.6%. We amortize these costs on a straight-line basis over the explicit service period.

The aggregate intrinsic value of options exercised during the three months ended June 30, 2016 and June 30, 2015 was $2.8 million and $1.0 million, respectively. The aggregate intrinsic value of options exercised during the nine months ended June 30, 2016 and June 30, 2015 was $6.1 million and $4.7 million, respectively. The table below summarizes the changes in all stock options during the nine months ended June 30, 2016:

 
Options
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Term
 (in years)
 
Aggregate
Intrinsic
Value
(in millions)
Outstanding at September 30, 2015
7,189,654

 
$
33.19

 
 
 
 
Granted
1,249,790

 
33.38

 
 
 
 
Exercised
(665,214
)
 
31.22

 
 
 
 
Expired
(44,584
)
 
35.04

 
 
 
 
Forfeited
(27,392
)
 
38.82

 
 
 
 
Adjustment due to the Separation

930,865

 
 
 
 
 
 
Outstanding at June 30, 2016
8,633,119

 
$
29.76

 
5.2
 
$
92.5

Exercisable at June 30, 2016
6,937,039

 
$
28.55

 
4.2
 
$
80.0


Stock Appreciation Rights

As part of the Combination, we issued SARs to replace outstanding MWV SARs. The SARs were valued using the Black-Scholes option pricing model. The company measures compensation expense related to the SAR awards at the end of each period. No additional SARs are presently expected to be issued.

The table below summarizes the changes in all SARs during the nine months ended June 30, 2016:
 
SARs
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Term
 (in years)
 
Aggregate
Intrinsic
Value
(in millions)
Outstanding at September 30, 2015
86,419

 
$
28.98

 
 
 
 
Granted
—

 
—

 
 
 
 
Exercised
(6,840
)
 
31.93

 
 
 
 
Expired
(14,742
)
 
24.29

 
 
 
 
Forfeited
—

 
—

 
 
 
 
Adjustment due to the Separation

8,183

 
 
 
 
 
 
Outstanding at June 30, 2016
73,020

 
$
26.41

 
4.4
 
$
0.9

Exercisable at June 30, 2016
73,020

 
$
26.41

 
4.4
 
$
0.9



The aggregate intrinsic value of stock appreciation rights exercised during the nine months ended June 30, 2016 was $0.1 million.

Restricted Stock

Restricted stock is typically granted annually to non-employee directors and certain of our employees. Our non-employee director awards have a service condition, generally vest over one year and are treated as issued and carry dividend and voting rights until they vest. The vesting provisions for our employee awards may vary from grant to grant; however, vesting generally is contingent upon meeting various service and/or performance or market goals and the grants generally vest over a period of three years. Subject to the level of performance attained, the target award of the grants with performance goals may be increased up to 200% of target or decreased to zero depending upon the terms of the individual grant. Our grants provide for accelerated vesting if there is a change in control (as defined in the applicable plan). However, the Compensation Committee of the board of directors has determined that effective with the fiscal 2013 grants, other than in circumstances such as death and disability, grants will include a provision requiring both a change of control and termination of employment to accelerate vesting. For certain employee grants, the grantee of the restricted stock is entitled to receive dividend equivalent units (i.e. dividends in the form of shares during the period of restriction), but will forfeit the restricted award and the dividend equivalents if the employee separates from the Company during the vesting period or if the predetermined goals are not accomplished.

During the nine months ended June 30, 2016, pursuant to our 2016 Incentive Stock Plan, we granted 64,155 shares of restricted stock to our non-employee directors and 1,229,245 restricted stock awards to certain of our employees. The employee grants predominately consisted of awards that included service and performance conditions.

The aggregate fair value of restricted stock that vested during the three and nine months ended June 30, 2016 was $2.1 million and $54.0 million, respectively. The aggregate fair value of restricted stock that vested during the three and nine months ended June 30, 2015 was $0.1 million and $82.4 million, respectively.

The table below summarizes the changes in unvested restricted stock awards during the nine months ended June 30, 2016:
 
Shares / Units
 
Weighted Average
Grant Date Fair
Value
Unvested at September 30, 2015
2,327,231

 
$
56.13

Granted(1)
1,739,953

 
35.74

Vested
(1,499,818
)
 
49.60

Forfeited
(79,266
)
 
51.11

Adjustment due to the Separation
302,180

 
 
Unvested at June 30, 2016 (2)
2,790,280

 
$
41.11

(1)
Fiscal 2016 target awards to employees of 1,191,062 shares may be increased to 200% of the target or decreased to zero, subject to the level of performance attained. The awards are reflected in the table at the target award amount of 100%. In connection with the Combination, the performance condition for the 2013 fiscal grant was based on the Cash Flow to Equity Ratio (as defined in the applicable grant letter). The performance goal was subsequently determined in accordance with the applicable grant letter to be attained at 200.0% of target. Awards issued during the nine months ended June 30, 2016 also include shares accelerated for terminated employees as a result of the Combination which were achieved at between 146.5% and 200% of target. Awards granted for attainment of a performance condition at an amount in excess of target resulted in the issuance and vesting of an additional 446,553 shares in the nine months ended June 30, 2016.

(2)
Target awards with a performance condition, net of subsequent forfeitures, granted may be increased up to 200% of the target or decreased to zero, subject to the level of performance attained. The awards are reflected in the table at the target award amount of 100%. Based on current facts and assumptions, we are forecasting the performance of the grants to be attained at levels that would result in the issuance of approximately 1.5 million additional shares. However, it is possible that the actual performance attained may vary.
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
                    
Environmental and Other Matters

Environmental compliance requirements are a significant factor affecting our business. We employ manufacturing processes which result in various discharges, emissions and wastes. These processes are subject to numerous federal, state, local and international environmental laws and regulations, as well as the requirements of environmental permits and similar authorizations issued by various governmental authorities.

On January 31, 2013, the EPA published a set of four interrelated final rules establishing national air emissions standards for hazardous air pollutants from industrial, commercial and institutional boilers and process heaters, commonly known as “Boiler MACT.” For our boilers, Boiler MACT required compliance by January 31, 2016, unless a facility requested and received an extension. All of our mills that are subject to regulation under Boiler MACT met the January 31, 2016 compliance deadline, with the exception of those mills for which we have obtained a compliance extension. We expect our mills that have obtained an extension to be in compliance by their respective extension dates, none of which extend beyond January 31, 2017. On July 29, 2016, the U.S. Court of Appeals for the District of Columbia Circuit (“the Court”) issued a ruling on the consolidated cases challenging Boiler MACT. The Court vacated key portions of the rule, including emission limits for certain subcategories of solid fuel boilers, and remanded other issues to the EPA for further rulemaking. At this time, we cannot predict with certainty how the recent decision will impact our existing Boiler MACT strategies or whether we will incur additional costs to comply with any revised Boiler MACT standards.

In addition to Boiler MACT, we are subject to a number of other federal, state, local and international environmental rules that may impact our business, including the National Ambient Air Quality Standards for nitrogen oxide, sulfur dioxide, fine particulate matter and ozone for facilities in the U.S. We cannot predict with certainty how any future changes in environmental laws, regulations and/or enforcement practices will affect our business; however, it is possible that our compliance with new environmental standards may require substantial additional capital expenditures and/or increase our operating costs.

We are involved in various administrative proceedings relating to environmental matters that arise in the normal course of business. Although the ultimate outcome of such matters cannot be predicted with certainty and we cannot at this time estimate any reasonably possible losses based on available information, management does not believe that the currently expected outcome of any environmental proceedings and claims that are pending or threatened against us will have a material adverse effect on our results of operations, financial condition or cash flows.

CERCLA and Other Remediation Costs

We face potential liability under federal, state, local and international laws as a result of releases, or threatened releases, of hazardous substances into the environment from various sites owned and operated by third parties at which Company-generated wastes have allegedly been deposited. Generators of hazardous substances sent to off-site disposal locations at which environmental problems exist, as well as the owners of those sites and certain other classes of persons, are liable for response costs for the investigation and remediation of such sites under CERCLA and analogous laws. While joint and several liability is authorized under CERCLA, liability is typically shared with other PRPs and costs are commonly allocated according to relative amounts of waste deposited and other factors.

In addition, certain of our current or former locations are being investigated or remediated under various environmental laws and regulations. Based on current facts and assumptions, we do not believe that the costs of these projects will have a material adverse effect on our results of operations, financial condition or cash flows. However, the discovery of contamination or the imposition of additional obligations at these or other sites in the future could result in additional costs.

On January 26, 2009, Smurfit-Stone and certain of its subsidiaries filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code. Smurfit-Stone’s Canadian subsidiaries also filed to reorganize in Canada. We believe that matters relating to previously identified third party PRP sites and certain facilities formerly owned or operated by Smurfit-Stone have been or will be satisfied claims in the Smurfit-Stone bankruptcy proceedings. However, we may face additional liability for cleanup activity at sites that existed prior to bankruptcy discharge, but are not currently identified. Some of these liabilities may be satisfied from existing bankruptcy reserves.

We believe that we can assert claims for indemnification pursuant to existing rights we have under settlement and purchase agreements in connection with certain of our existing remediation sites. In addition, we believe that we have insurance coverage, subject to applicable deductibles/retentions, policy limits and other conditions, for certain environmental matters. However, there can be no assurance that we will be successful with respect to any claim regarding these insurance or indemnification rights or that, if we are successful, any amounts paid pursuant to the insurance or indemnification rights will be sufficient to cover all our costs and expenses. We also cannot predict with certainty whether we will be required to perform other remediation projects, and it is possible that our remediation requirements and costs could increase materially in the future and exceed current reserves. In addition, we cannot assess with certainty the impact that future changes in cleanup standards or federal, state or other environmental laws, regulations or enforcement practices will have on our obligations under CERCLA and other remediation programs, and therefore, our results of operations, financial condition or cash flows.

As of June 30, 2016, we had $16.6 million reserved for environmental liabilities on an undiscounted basis, of which $8.7 million is included in other long-term liabilities and $7.9 million in other current liabilities, including amounts accrued in connection with environmental obligations relating to the manufacturing facilities that we have closed. We believe the liability for these matters was adequately reserved at June 30, 2016.

Climate Change

Certain jurisdictions in which we have manufacturing facilities or other investments have taken actions to address climate change. In the U.S., the EPA has issued the Clean Air Act permitting regulations applicable to certain facilities that emit GHG. However, on June 23, 2014, the U.S. Supreme Court issued a decision holding that the EPA may not treat GHG emissions as an air pollutant for purposes of determining whether a source is a major source required to obtain a PSD or Title V permit. The Supreme Court also said that the EPA could continue to require that PSD permits otherwise required based on emissions of conventional pollutants contain limitations on GHG emissions based on the application of Best Available Control Technology. The EPA is continuing to examine the implications of the Supreme Court’s decision, including how the EPA will need to revise its permitting regulations and related impacts to state programs. The EPA also has promulgated a rule requiring certain industrial facilities that emit 25,000 metric tons or more of carbon dioxide equivalent per year to file an annual report of their emissions. While we have facilities subject to existing EPA GHG permitting and reporting requirements, the impact of these requirements has not been material to date.
  
Additionally, the EPA has been working on a set of interrelated rulemakings aimed at cutting carbon emissions from power plants. On August 3, 2015, the EPA issued a final rule establishing GHG emission guidelines for existing electric utility generating units (known as the “Clean Power Plan”). On the same day, the EPA issued a second rule setting standards of performance for new, modified and reconstructed electric utility generating units. While these rules do not apply directly to the power generation facilities at our mills, they have the potential to increase the cost of purchased electricity for our manufacturing operations and change the treatment of certain types of biomass that are currently considered carbon neutral. On February 9, 2016, the U.S. Supreme Court issued a stay halting implementation of the Clean Power Plan until the pending legal challenges to the rule are resolved. A number of states subject to the Clean Power Plan have stopped working on their implementation strategies in light of this decision; however, certain states where we operate manufacturing facilities are continuing their efforts. We are carefully monitoring the state-level developments relating to this rule. Due to ongoing litigation and other uncertainties regarding these GHG regulations, their impact on us cannot be quantified with certainty at this time.

In addition to national efforts to regulate climate change, some U.S. states in which we have manufacturing operations are also taking measures to reduce GHG emissions, such as requiring GHG emissions reporting or the development of regional cap-and trade programs. California has enacted a cap-and-trade program that took effect in 2012, and includes enforceable compliance obligations that began on January 1, 2013. We do not have any manufacturing facilities that are subject to the cap-and-trade requirements in California; however, we are continuing to monitor the implementation of this program as well as proposed mandatory GHG reduction efforts in other states. Also, the Washington Department of Ecology is working on a rulemaking which is intended to limit GHGs from facilities that have average annual carbon dioxide equivalent emissions equal to or exceeding 100,000 metric tons/year and proposes to begin GHG emissions reduction requirements for some regulated entities in 2017. Energy intensive and trade exposed facilities and transportation fuel importers, including our Tacoma, WA mill, would be subject to regulation under this program. We are carefully monitoring the development of this rulemaking to assess its potential impact on our Tacoma operations.

In April 2016, the U.S. and over 170 other countries signed the Paris Agreement, which arose out of negotiations at the United Nation’s Conference of Parties (COP21) climate summit in December 2015. The Paris Agreement establishes a framework for reducing global GHG emissions. By signing the Paris Agreement, the U.S. made a non-binding commitment to reduce economy-wide GHG emissions by 26% to 28% below 2005 levels by 2025. Other countries in which we conduct business, including, China, European Union member states and India, have set similar GHG reduction targets. The Paris Agreement will enter into force 30 days after the date on which at least 55 parties accounting in total for at least an estimated 55% of the total global GHG emissions have ratified it. It is unclear at this time whether the Paris Agreement will become legally binding or how it will impact the company’s operations; however, mandatory GHG reduction requirements that may be imposed in accordance with the Paris Agreement could require process changes, capital expenditures and/or increase the Company’s operating costs at some facilities.

Several of our international facilities are located in countries that have already adopted GHG emissions trading schemes. For example, Quebec has become a member of the Western Climate Initiative, which is a collaboration among California and certain Canadian provinces that have joined together to create a cap-and-trade program to reduce GHG emissions. In 2009, Quebec adopted a target of reducing GHG emissions by 20% below 1990 levels by 2020. In 2011, Quebec issued a final regulation establishing a regional cap-and-trade program that required reductions in GHG emissions from covered emitters as of January 1, 2013. Our mill in Quebec is subject to these cap-and-trade requirements, although the direct impact of this regulation has not been material to date. Compliance with this program and other similar programs may require future expenditures to meet required GHG emission reduction requirements in future years.

The regulation of climate change continues to develop in the areas of the world where we conduct business. We have systems in place for tracking the GHG emissions from our energy-intensive facilities, and we carefully monitor developments in climate change laws, regulations and policies to assess the potential impact of such developments on our results of operations, financial condition, cash flows and disclosure obligations.

Litigation

In 2010, Smurfit-Stone was one of nine U.S. and Canadian containerboard producers named as defendants in a lawsuit, in the U.S. District Court of the Northern District of Illinois, alleging that these producers violated the Sherman Act by conspiring to limit the supply and fix the prices of containerboard from mid-2005 through November 8, 2010 (the “Antitrust Litigation”). Plaintiffs have since amended their complaint by alleging a class period from February 15, 2004 through November 8, 2010. RockTenn CP, LLC, as the successor to Smurfit-Stone, is a defendant with respect to the period after Smurfit-Stone’s discharge from bankruptcy on June 30, 2010 through November 8, 2010. The complaint seeks treble damages and costs, including attorney’s fees. In March 2015, the court granted the Plaintiffs’ motion for class certification and the class defendants, including us, appealed that decision. On August 4, 2016, the United States Court of Appeals for the Seventh Circuit affirmed the District Court’s decision regarding class certification. We believe the allegations are without merit and will defend this lawsuit vigorously. However, at this stage of the litigation, we are unable to predict the ultimate outcome or estimate a range of reasonably possible losses.

As with numerous other large industrial companies, we have been named a defendant in asbestos-related personal injury litigation. Typically, these suits also name many other corporate defendants. To date, the costs resulting from the litigation, including settlement costs, have not been significant. As of June 30, 2016, there were approximately 575 lawsuits. We believe that we have substantial insurance coverage, subject to applicable deductibles and policy limits, with respect to asbestos claims. We have valid defenses to these claims and intend to continue to defend them vigorously. Should the volume of litigation grow substantially, it is possible that we could incur significant costs resolving these cases. We believe that the resolution of pending litigation and proceedings is not expected to have a material adverse effect on our consolidated financial condition or liquidity. In any given period or periods, however, it is possible such proceedings or matters could have a material effect on our results of operations.

We are a defendant in a number of other lawsuits and claims arising out of the conduct of our business. While the ultimate results of such suits or other proceedings against us cannot be predicted with certainty, management believes the resolution of these other matters will not have a material adverse effect on our results of operations, financial condition or cash flows.

Guarantees

We make certain guarantees in the course of conducting our operations or in connection with certain business dispositions. The guarantees include items such as funding of net losses in proportion to our ownership share of certain joint ventures, debt guarantees related to certain unconsolidated entities acquired in acquisitions, indemnifications of lessors in certain facilities and equipment operating leases for items such as additional taxes being assessed due to a change in tax law, and certain other agreements and regulatory obligations. We estimate the exposure for these matters could be up to $50 million. As of June 30, 2016, we have recorded $5.2 million for the estimated fair value of these guarantees. We are unable to estimate our maximum exposure under operating leases because it is dependent on potential changes in the tax law; however, we believe our exposure related to guarantees would not have a material impact on our results of operations, financial condition or cash flows.
Segment Information
Segment Information
Segment Information

Subsequent to the Separation, we report our financial results of operations in the following three reportable segments: Corrugated Packaging, which consists of our corrugated mill and packaging operations, as well as our recycling operations; Consumer Packaging, which consists of consumer mills, folding carton, beverage, merchandising displays, home, health and beauty dispensing, and partition operations; and Land and Development, which develops and sells real estate primarily in the Charleston, SC market. Certain income and expenses are not allocated to our segments and, thus, the information that management uses to make operating decisions and assess performance does not reflect such amounts. Items not allocated are reported as non-allocated expenses or in other line items in the table below after segment income.

The following table shows selected operating data for our segments (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Net sales (aggregate):
 
 
 
 
 
 
 
Corrugated Packaging
$
1,967.7

 
$
1,887.3

 
$
5,864.8

 
$
5,529.6

Consumer Packaging
1,635.8

 
690.2

 
4,766.4

 
2,098.1

Land and Development
42.0

 
—

 
76.1

 
—

Total
$
3,645.5

 
$
2,577.5

 
$
10,707.3

 
$
7,627.7

Less net sales (intersegment):
 
 
 
 
 
 
 
Corrugated Packaging
$
31.4

 
$
29.7

 
$
99.2

 
$
93.4

Consumer Packaging
17.6

 
8.9

 
48.0

 
25.6

Land and Development
—

 
—

 
—

 
—

Total
$
49.0

 
$
38.6

 
$
147.2

 
$
119.0

Net sales (unaffiliated customers):
 
 
 
 
 
 
 
Corrugated Packaging
$
1,936.3

 
$
1,857.6

 
$
5,765.6

 
$
5,436.2

Consumer Packaging
1,618.2

 
681.3

 
4,718.4

 
2,072.5

Land and Development
42.0

 
—

 
76.1

 
—

Total
$
3,596.5

 
$
2,538.9

 
$
10,560.1

 
$
7,508.7

Segment income:
 
 
 
 
 
 
 
Corrugated Packaging
$
192.4

 
$
217.0

 
$
547.5

 
$
571.3

Consumer Packaging
151.7

 
77.9

 
342.6

 
189.3

Land and Development
9.5

 
—

 
6.2

 
—

Segment income
353.6

 
294.9

 
896.3

 
760.6

Pension lump sum settlement and retiree medical curtailment, net
—

 
0.4

 
—

 
(11.5
)
Restructuring and other costs, net
(43.1
)
 
(13.1
)
 
(317.0
)
 
(35.7
)
Non-allocated expenses
(15.3
)
 
(12.7
)
 
(29.0
)
 
(43.5
)
Interest expense
(64.0
)
 
(22.6
)
 
(193.2
)
 
(68.9
)
Interest income and other income (expense), net
20.9

 
(0.7
)
 
43.2

 
(1.0
)
Income from continuing operations before income taxes

$
252.1

 
$
246.2

 
$
400.3

 
$
600.0



The changes in the carrying amount of goodwill for the nine months ended June 30, 2016 are as follows (in millions):
 
Corrugated Packaging
 
Consumer
Packaging
 
Land and Development
 
Total
Balances as of September 30, 2015
 
 
 
 
 
 
 
Goodwill
$
1,667.5

 
$
3,022.4

 
$
—

 
$
4,689.9

Accumulated impairment losses
—

 
(42.8
)
 
—

 
(42.8
)
 
1,667.5

 
2,979.6

 
—

 
4,647.1

Goodwill acquired
50.5

 
10.2

 
—

 
60.7

Purchase price allocation adjustments
(3.7
)
 
77.0

 
—

 
73.3

Goodwill disposed of
(24.0
)
 
—

 
—

 
(24.0
)
Foreign exchange translation adjustment
34.7

 
(3.8
)
 
—

 
30.9

Balances as of June 30, 2016
 
 
 
 
 
 
 
Goodwill
1,725.0

 
3,105.8

 
—

 
4,830.8

Accumulated impairment losses
—

 
(42.8
)
 
—

 
(42.8
)
 
$
1,725.0

 
$
3,063.0

 
$
—

 
$
4,788.0



The goodwill acquired in the nine months ended June 30, 2016 relates to the SP Fiber Acquisition and the Packaging Acquisition, and the purchase price allocation adjustments relate to the refinement of the purchase price allocation in the Combination. The goodwill disposed of in the Corrugated Packaging segment relates to the disposal of a portion of the reporting unit in connection with the investment in the Grupo Gondi unconsolidated joint venture in the third quarter of fiscal 2016. In the first quarter of fiscal 2016, prior to the Separation and subsequent classification of the Specialty Chemicals business as a discontinued operation, we recorded a goodwill impairment charge related to our Specialty Chemicals reporting unit. See “Note 6. Discontinued Operations” for more information.
Equity and Other Comprehensive Income (Tables)
Schedule of Stockholders Equity 
The following is a summary of the changes in total equity for the nine months ended June 30, 2016 (in millions):
 
WestRock
Company
Stockholders’
Equity
 
Noncontrolling (1)
Interests
 
Total
Equity
Balance at September 30, 2015
$
11,651.8

 
$
132.1

 
$
11,783.9

Net (loss) income attributable to common stockholders
(304.3
)
 
4.2

 
(300.1
)
Other comprehensive income, net of tax
160.9

 
—

 
160.9

Noncontrolling interests assumed in acquisition
—

 
10.9

 
10.9

Income tax expense from share-based plans
(12.3
)
 
—

 
(12.3
)
Compensation expense under share-based plans
52.7

 
—

 
52.7

Cash dividends declared (per share - $1.125)(2)
(288.9
)
 
—

 
(288.9
)
Distributions and adjustments to noncontrolling interests
—

 
(11.2
)
 
(11.2
)
Sale of subsidiary shares from noncontrolling interest
—

 
(0.2
)
 
(0.2
)
Issuance of common stock, net of stock received for minimum tax withholdings
(3.2
)
 
—

 
(3.2
)
Purchases of common stock
(285.1
)
 
—

 
(285.1
)
Separation of Specialty Chemicals business
(1,058.5
)
 
(26.1
)
 
(1,084.6
)
Balance at June 30, 2016
$
9,913.1

 
$
109.7

 
$
10,022.8


(1) 
Excludes amounts related to contingently redeemable noncontrolling interests, which are separately classified outside of permanent equity in the mezzanine section of the Condensed Consolidated Balance Sheets.
(2) 
Includes cash dividends paid, and dividends declared but unpaid, related to the shares reserved but unissued to satisfy Smurfit-Stone bankruptcy claims.

Accumulated Other Comprehensive Income (Loss) [Table Text Block] 
The tables below summarize the changes in accumulated other comprehensive loss, net of tax, by component for the nine months ended June 30, 2016 and June 30, 2015 (in millions):

 
Cash Flow Hedges
 
Defined Benefit Pension and Postretirement Plans
 
Foreign Currency Items
 
Total (1)
Balance at September 30, 2015
$
(1.4
)
 
$
(540.7
)
 
$
(238.1
)
 
$
(780.2
)
Other comprehensive (loss) income before reclassifications
(0.5
)
 
1.4

 
133.4

 
134.3

Amounts reclassified from accumulated other comprehensive loss
1.0

 
5.4

 
20.2

 
26.6

Specialty Chemicals separation
0.4

 
1.9

 
5.6

 
7.9

Net current period other comprehensive income
0.9

 
8.7

 
159.2

 
168.8

Balance at June 30, 2016
$
(0.5
)
 
$
(532.0
)
 
$
(78.9
)
 
$
(611.4
)

(1)     All amounts are net of tax and noncontrolling interest.

 
Cash Flow Hedges
 
Defined Benefit Pension and Postretirement Plans
 
Foreign Currency Items
 
Total (1)
Balance at September 30, 2014
$
(0.2
)
 
$
(498.2
)
 
$
3.1

 
$
(495.3
)
Other comprehensive loss before reclassifications
—

 
(16.5
)
 
(44.5
)
 
(61.0
)
Amounts reclassified from accumulated other comprehensive loss
—

 
23.8

 
—

 
23.8

Net current period other comprehensive income (loss)
—

 
7.3

 
(44.5
)
 
(37.2
)
Balance at June 30, 2015
$
(0.2
)
 
$
(490.9
)
 
$
(41.4
)
 
$
(532.5
)

(1)     All amounts are net of tax and noncontrolling interest.

Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] 
The following table summarizes the reclassifications out of accumulated other comprehensive loss by component (in millions):

 
Three Months Ended
 
Three Months Ended
 
June 30, 2016
 
June 30, 2015
 
Pretax
 
Tax
 
Net of Tax
 
Pretax
 
Tax
 
Net of Tax
Amortization of defined benefit pension and postretirement items (1)
 
 
 
 
 
 
 
 
 
 
 
      Actuarial losses (2)
$
(1.9
)
 
$
0.6

 
$
(1.3
)
 
$
(9.9
)
 
$
3.7

 
$
(6.2
)
      Prior service (costs) credits (2)
(0.4
)
 
0.3

 
(0.1
)
 
—

 
—

 
—

Subtotal defined benefit plans
(2.3
)
 
0.9

 
(1.4
)
 
(9.9
)
 
3.7

 
(6.2
)
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 
 
 
 
 
 
 
 
 
 
 
      Sale of foreign subsidiary (3)
(20.2
)
 
—

 
(20.2
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments (1)

 
 
 
 
 
 
 
 
 
 
 
      Commodity cash flow hedges (4)

(0.3
)
 
—

 
(0.3
)
 
—

 
—

 
—

      Foreign currency cash flow hedges (5)

(0.5
)
 
0.2

 
(0.3
)
 
—

 
—

 
—

Subtotal derivative instruments


(0.8
)
 
0.2

 
(0.6
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Total reclassifications for the period
$
(23.3
)
 
$
1.1

 
$
(22.2
)
 
$
(9.9
)
 
$
3.7

 
$
(6.2
)

(1)  
Amounts in parentheses indicate charges to earnings. Amounts pertaining to noncontrolling interests are excluded.
(2) 
Included in the computation of net periodic pension cost (See “Note 13. Retirement Plans” for additional details).
(3) 
Included in interest income and other income (expense), net.
(4) 
Included in cost of goods sold.
(5) 
Included in net sales.

The following table summarizes the reclassifications out of accumulated other comprehensive loss by component (in millions):      
 
Nine Months Ended
 
Nine Months Ended
 
June 30, 2016
 
June 30, 2015
 
Pretax
 
Tax
 
Net of Tax
 
Pretax
 
Tax
 
Net of Tax
Amortization of defined benefit pension and postretirement items (1)
 
 
 
 
 
 
 
 
 
 
 
      Actuarial losses (2)
$
(6.5
)
 
$
1.9

 
$
(4.6
)
 
$
(46.2
)
 
$
17.5

 
$
(28.7
)
      Prior service (cost) credits (2)
(1.3
)
 
0.5

 
(0.8
)
 
8.0

 
(3.1
)
 
4.9

Subtotal defined benefit plans
(7.8
)
 
2.4

 
(5.4
)
 
(38.2
)
 
14.4

 
(23.8
)
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
 
 
 
 
 
 
 
 
 
 
 
      Sale of foreign subsidiary (3)
(20.2
)
 
—

 
(20.2
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments (1)
 
 
 
 
 
 
 
 
 
 
 
    Commodity cash flow hedges (4)
(1.4
)
 
0.5

 
(0.9
)
 
—

 
—

 
—

    Foreign currency cash flow hedges (5)
(0.2
)
 
0.1

 
(0.1
)
 
—

 
—

 
—

Subtotal derivative instruments
(1.6
)
 
0.6

 
(1.0
)
 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Total reclassifications for the period
$
(29.6
)
 
$
3.0

 
$
(26.6
)
 
$
(38.2
)
 
$
14.4

 
$
(23.8
)

(1)  
Amounts in parentheses indicate charges to earnings. Amounts pertaining to noncontrolling interests are excluded.
(2) 
Included in the computation of net periodic pension cost (see “Note 13. Retirement Plans” for additional details).
(3) 
Included in interest income and other income (expense), net.
(4) 
Included in cost of goods sold.
(5) 
Included in net sales.
Earnings per Share (Tables)
Schedule of earnings per share, basic and diluted
The following table sets forth the computation of basic and diluted earnings per share under the two-class method (in millions, except per share data):
 
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Basic earnings (loss) per share:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Income from continuing operations

$
152.4

 
$
157.9

 
$
241.2

 
$
393.9

Less: Net income from continuing operations attributable to noncontrolling interest
(0.4
)
 
(1.5
)
 
(1.8
)
 
(2.6
)
Income available to common stockholders, before discontinued operations

152.0

 
156.4

 
239.4

 
391.3

Loss from discontinued operations (1)
(59.7
)
 
—

 
(543.7
)
 
—

Net income (loss) attributable to common stockholders
$
92.3

 
$
156.4

 
$
(304.3
)
 
$
391.3

Denominator:
 
 
 
 
 
 
 
Basic weighted average shares outstanding
252.7

 
141.1

 
254.8

 
140.7

 
 
 
 
 
 
 
 
Basic earnings per share from continuing operations
$
0.60

 
$
1.11

 
$
0.94

 
$
2.78

Basic loss per share from discontinued operations
(0.23
)
 
—

 
(2.13
)
 
—

Basic earnings (loss) per share attributable to common stockholders
$
0.37

 
$
1.11

 
$
(1.19
)
 
$
2.78

 
 
 
 
 
 
 
 
Diluted earnings (loss) per share:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Income from continuing operations

$
152.4

 
$
157.9

 
$
241.2

 
$
393.9

Less: Net income from continuing operations attributable to noncontrolling interest
(0.4
)
 
(1.5
)
 
(1.8
)
 
(2.6
)
Income available to common stockholders, before discontinued operations

152.0

 
156.4

 
239.4

 
391.3

Loss from discontinued operations (1)
(59.7
)
 
—

 
(543.7
)
 
—

Net income (loss) attributable to common stockholders
$
92.3

 
$
156.4

 
$
(304.3
)
 
$
391.3

Denominator:
 
 
 
 
 
 
 
Basic weighted average shares outstanding
252.7

 
141.1

 
254.8

 
140.7

Effect of dilutive stock options and non-participating securities
3.5

 
1.6

 
3.8

 
2.0

Diluted weighted average shares outstanding
256.2

 
142.7

 
258.6

 
142.7

 
 
 
 
 
 
 
 
Diluted earnings per share from continuing operations
$
0.59

 
$
1.10

 
$
0.93

 
$
2.74

Diluted loss per share from discontinued operations
(0.23
)
 
—

 
(2.11
)
 
—

Diluted earnings (loss) per share attributable to common stockholders
$
0.36

 
$
1.10

 
$
(1.18
)
 
$
2.74



(1)  
Net of income attributable to noncontrolling interests of discontinued operations of $1.0 million and $4.3 million for the three and nine months ended June 30, 2016, respectively.

Acquisitions Purchase Price Allocation, Opening Balance (Tables)
Schedule of Business Acquisitions, by Acquisition [Table Text Block]
The following table summarizes the fair values of the assets acquired and liabilities assumed by major class of assets and liabilities as of the acquisition date, as well as adjustments made during fiscal 2016 (referred to as “measurement period adjustments”) (in millions):
 
Amounts Recognized as of the Acquisition Date (1)
 
Measurement Period Adjustments (2)
 
Amounts Recognized as of Acquisition Date (as Adjusted) (3)
Cash and cash equivalents
$
265.7

 
$
—

 
$
265.7

Current assets, excluding cash and cash equivalents
1,858.8

 
4.8

 
1,863.6

Property, plant and equipment
3,991.5

 
16.7

 
4,008.2

Prepaid pension asset
1,407.8

 
(9.9
)
 
1,397.9

Goodwill
3,817.3

 
55.3

 
3,872.6

Intangible assets
2,994.2

 
—

 
2,994.2

Restricted assets held by special purpose entities
1,302.0

 
—

 
1,302.0

Other long-term assets
363.8

 
18.4

 
382.2

Total assets acquired
16,001.1

 
85.3

 
16,086.4

 
 
 
 
 
 
Current portion of debt
62.3

 
74.8

 
137.1

Current liabilities
1,099.4

 
(47.3
)
 
1,052.1

Long-term debt due after one year
2,090.6

 
18.3

 
2,108.9

Non-recourse liabilities held by special purpose entities
1,181.0

 
—

 
1,181.0

Accrued pension and other long-term benefits
235.1

 
—

 
235.1

Deferred income tax liabilities
2,366.7

 
(4.4
)
 
2,362.3

Other long-term liabilities
520.0

 
43.9

 
563.9

Noncontrolling interest
159.3

 
—

 
159.3

Total liabilities and noncontrolling interest assumed
7,714.4

 
85.3

 
7,799.7

 
 
 
 
 
 
Net assets acquired (4)
$
8,286.7

 
$
—

 
$
8,286.7

(1) 
As previously reported in “Note 6. Merger and Acquisitions” of the Notes to Consolidated Financial Statements section of the Fiscal 2015 Form 10-K.

(2) 
The measurement period adjustments recorded in fiscal 2016 did not have a significant impact on our condensed consolidated statements of operations for the three months ended September 30, 2015 or the three and nine months ended June 30, 2016. In addition, these adjustments did not have a significant impact on our consolidated balance sheet as of September 30, 2015. Therefore, we have recorded the cumulative impact in fiscal 2016 and have not retrospectively adjusted the comparative 2015 financial information presented herein.

(3) 
The measurement period adjustments were due primarily to refinements to third party appraisals and carrying amounts of certain assets and liabilities as well as adjustments to certain tax accounts based on, among other things, adjustments to deferred tax liabilities, including any appraisal adjustments, analysis of the tax basis of acquired assets and liabilities, other tax adjustments and the classification of supplier financing arrangements. The net impact of the measurement period adjustments resulted in a net increase to goodwill.

(4) 
The net assets acquired include the Specialty Chemicals business which was separated on May 15, 2016. See “Note 6. Discontinued Operations” for more information.

Acquisitions Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination (Tables)
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]
The following table summarizes the weighted average life and gross carrying amount relating to intangible assets recognized in the Combination, excluding goodwill (in millions):
 
 
Weighted Avg. Life
 
Gross Carrying Amount
Customer relationships
 
19.2
 
$
2,881.7

Patents
 
9.8
 
57.2

Trademarks
 
4.5
 
52.9

Favorable contracts
 
8.2
 
2.4

Total
 
18.8
 
$
2,994.2


Acquisitions Business Acquisition, Pro Forma Information (Tables)
Business Acquisition, Pro Forma Information [Table Text Block]
The following unaudited pro forma information reflects our condensed consolidated results of operations as if the Combination had taken place on October 1, 2013. The unaudited pro forma information is not necessarily indicative of the results of operations that we would have reported had the transaction actually occurred at the beginning of these periods nor is it necessarily indicative of future results. The unaudited pro forma financial information does not reflect the impact of future events that may occur after the Combination, including, but not limited to, anticipated costs savings from synergies or other operational improvements. The net sales have been adjusted to reflect the discontinued operations of the Specialty Chemicals business.
 
Three Months Ended June 30, 2015
 
Nine Months Ended June 30, 2015
 
(Unaudited, in millions)
Net sales
$
3,654.3

 
$
10,730.9

Net income attributable to common stockholders
$
188.2

 
$
483.1

Discontinued Operations (Tables)
Disposal Groups, Including Discontinued Operations [Table Text Block]
The following table presents the financial results of Specialty Chemicals’ discontinued operations (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30, 2016
 
June 30, 2016
Net sales
$
120.0

 
$
533.7

Cost of goods sold
83.8

 
387.5

Gross Profit
36.2

 
146.2

Selling, general and administrative, excluding intangible amortization
11.8

 
65.6

Selling, general and administrative intangible amortization
5.9

 
28.8

Restructuring and other costs, net

22.5

 
50.9

Impairment of Specialty Chemicals goodwill and intangibles
101.1

 
579.4

Operating loss
(105.1
)
 
(578.5
)
Interest income (expense) and other income (expense), net
0.2

 
0.1

Loss from discontinued operations before income taxes
(104.9
)
 
(578.4
)
Income tax benefit
46.2

 
39.0

Loss from discontinued operations

$
(58.7
)
 
$
(539.4
)
The carrying value of the assets and liabilities of discontinued operations on the Condensed Consolidated Balance Sheet as of September 30, 2015 were as follows (in millions):
 
September 30,
2015
ASSETS
Cash and cash equivalents
$
20.5

Accounts receivable (net of allowance of $0.1)
114.6

Inventories
202.4

Other current assets
25.3

Total current assets of discontinued operations
$
362.8

 
 
Property, plant and equipment, net
436.9

Goodwill
1,047.4

Intangibles, net
757.3

Other non-current assets
14.1

Total non-current assets of discontinued operations
$
2,255.7

 
 
LIABILITIES
Current portion of debt
10.4

Accounts payable
72.4

Accrued compensation and benefits
3.1

Other current liabilities
32.7

Total current liabilities of discontinued operations

$
118.6

 
 
Long-term debt due after one year
0.1

Deferred income taxes
350.9

Other non-current liabilities
10.8

Total non-current liabilities of discontinued operations

$
361.8

The following table presents the significant non-cash items and capital expenditures for Specialty Chemicals’ that are included in the nine months ended June 30, 2016 Condensed Consolidated Statements of Cash Flows (in millions):
 
Nine Months Ended
 
June 30, 2016
Depreciation, depletion and amortization
$
57.2

Impairment of Specialty Chemicals goodwill and intangibles
$
579.4

Capital expenditures
$
(43.9
)
Restructuring and Other Costs, Net (Tables)
Schedule of restructuring and other costs, net 
The following table presents a summary of restructuring and other charges, net, related to active restructuring and other initiatives that we incurred during the three and nine months ended June 30, 2016 and June 30, 2015, the cumulative recorded amount since we started the initiative, and our estimate of the total we expect to incur (in millions):

Summary of Restructuring and Other Costs, Net
Segment
 
Period
 
Net Property,
Plant and
Equipment (1)
 
Severance
and Other
Employee
Related
Costs
 
Equipment
and Inventory
Relocation
Costs
 
Facility
Carrying
Costs
 
Other
Costs
 
Total
Corrugated
Packaging(2)
 
Current Qtr.
 
$
1.4

 
$
0.4

 
$
—

 
$
3.4

 
$
0.4

 
$
5.6

 
YTD Fiscal 2016
 
181.3

 
15.6

 
0.3

 
15.9

 
8.8

 
221.9

 
Prior Year Qtr.
 
(2.5
)
 
0.2

 
0.4

 
0.6

 
0.1

 
(1.2
)
 
YTD Fiscal 2015
 
(0.9
)
 
0.2

 
0.8

 
2.5

 
1.2

 
3.8

 
Cumulative
 
223.2

 
45.1

 
8.0

 
30.8

 
22.4

 
329.5

 
Expected Total
 
223.2

 
45.1

 
8.7

 
33.3

 
23.8

 
334.1

Consumer Packaging(3)
 
Current Qtr.
 
1.5

 
3.4

 
0.4

 
0.1

 
—

 
5.4

 
YTD Fiscal 2016
 
(0.5
)
 
4.0

 
0.9

 
0.5

 
—

 
4.9

 
Prior Year Qtr.
 
0.1

 
0.6

 
(0.1
)
 
0.4

 
—

 
1.0

 
YTD Fiscal 2015
 
0.4

 
0.8

 
0.1

 
0.6

 
0.2

 
2.1

 
Cumulative
 
5.0

 
7.4

 
1.9

 
1.7

 
0.5

 
16.5

 
Expected Total
 
5.0

 
7.7

 
2.6

 
1.7

 
0.5

 
17.5

Other(4)
 
Current Qtr.
 
—

 
—

 
—

 
—

 
32.1

 
32.1

 
YTD Fiscal 2016
 
1.2

 
0.9

 
—

 
—

 
88.1

 
90.2

 
Prior Year Qtr.
 
—

 
—

 
—

 
—

 
13.3

 
13.3

 
YTD Fiscal 2015
 
—

 
—

 
—

 
—

 
29.8

 
29.8

 
Cumulative
 
1.2

 
0.9

 
—

 
—

 
362.2

 
364.3

 
Expected Total
 
1.2

 
0.9

 
—

 
—

 
362.2

 
364.3

Total
 
Current Qtr.
 
$
2.9

 
$
3.8

 
$
0.4

 
$
3.5

 
$
32.5

 
$
43.1

 
YTD Fiscal 2016
 
$
182.0

 
$
20.5

 
$
1.2

 
$
16.4

 
$
96.9

 
$
317.0

 
Prior Year Qtr.
 
$
(2.4
)
 
$
0.8

 
$
0.3

 
$
1.0

 
$
13.4

 
$
13.1

 
YTD Fiscal 2015
 
$
(0.5
)
 
$
1.0

 
$
0.9

 
$
3.1

 
$
31.2

 
$
35.7

 
Cumulative
 
$
229.4

 
$
53.4

 
$
9.9

 
$
32.5

 
$
385.1

 
$
710.3

 
Expected Total
 
$
229.4

 
$
53.7

 
$
11.3

 
$
35.0

 
$
386.5

 
$
715.9


(1) 
We have defined “Net Property, Plant and Equipment” as used in this Note 7 to represent property, plant and equipment impairment losses, subsequent adjustments to fair value for assets classified as held for sale, subsequent (gains) or losses on sales of property, plant and equipment and related parts and supplies, and accelerated depreciation on such assets, if any.

(2) 
The Corrugated Packaging segment current quarter charges primarily reflect restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with the permanent closures of the Coshocton, OH and Uncasville, CT medium mills, the Newberg, OR containerboard and newsprint mill, the Vapi, India linerboard mill, restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The prior year quarter and prior year to date charges primarily reflect on-going closure costs at previously closed facilities net of asset sales. The cumulative charges are primarily associated with the closure of the Coshocton, Uncasville, Newberg, Vapi and Matane, Quebec mills, a recycling facility and the cumulative closure of certain corrugated container plants and recycled collection facilities acquired in the Smurfit-Stone Acquisition, and gains and losses associated with the sale of closed facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.

(3) 
The Consumer Packaging segment current quarter charges primarily reflect the charges associated with a folding carton and merchandising displays facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with a folding carton and merchandising displays facility, on-going closure costs at previously closed facilities that were partially offset by the gain on sale of the Cincinnati, OH specialty recycled paperboard mill. The prior year quarter and prior year to date charges are primarily associated with on-going closure activity at previously closed facilities including the Cincinnati, OH mill. The cumulative charges primarily reflect our Cincinnati, OH mill and the consolidation of converting and merchandising displays facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.

(4) The expenses in the “Other” segment primarily reflect costs that we consider as related to Corporate that primarily consist of costs incurred as a result of the Combination, the Smurfit-Stone Acquisition, and other acquisition and divestiture expenses, excluding the Specialty Chemicals costs which are included in discontinued operations. The charges in the Net Property, Plant and Equipment column are for the write-off of leasehold improvements associated with the integration of the Combination. The pre-tax charges in the “Other” segment are summarized below (in millions):

 
Acquisition
Expenses
 
Integration
Expenses
 
Other Expenses
 
Total
Current Qtr.
$
1.4

 
$
30.3

 
$
0.4

 
$
32.1

YTD Fiscal 2016
$
6.9

 
$
82.0

 
$
1.3

 
$
90.2

Prior Year Qtr.
$
2.2

 
$
11.1

 
$
—

 
$
13.3

YTD Fiscal 2015
$
13.0

 
$
16.8

 
$
—

 
$
29.8



Acquisition expenses include expenses associated with mergers, acquisitions and other business combinations, whether consummated or not, as well as litigation expenses associated with mergers, acquisitions and business combinations, net of recoveries. Acquisition expenses primarily consist of advisory, legal, accounting, valuation and other professional or consulting fees. Integration expenses reflect primarily severance and other employee costs, professional services including work being performed to facilitate merger and acquisition integration, such as information systems integration costs, lease expense and other costs. Due to the complexity and duration of the integration activities associated with the Combination, the precise amount expected to be incurred has not been quantified in the “Expected Total” in the Summary of Restructuring and Other Costs, Net table above. We expect integration activities to continue during fiscal 2016 and 2017.

Schedule of Restructuring and Other Costs Reserve By Type of Cost 
The following table represents a summary of and the changes in the restructuring accrual, which is primarily composed of lease commitments, accrued severance and other employee costs, and a reconciliation of the restructuring accrual charges to the line item “Restructuring and other costs, net” on our Condensed Consolidated Statements of Operations (in millions):
 
Nine Months Ended
 
June 30,
 
2016
 
2015
Accrual at beginning of fiscal year
$
21.4

 
$
10.9

Additional accruals
57.1

 
0.9

Payments
(41.0
)
 
(6.5
)
Adjustment to accruals
0.1

 
0.8

Accrual at June 30
$
37.6

 
$
6.1


Reconciliation of accruals and charges to restructuring and other costs, net (in millions):
 
 
 
Nine Months Ended
 
June 30,
 
2016
 
2015
Additional accruals and adjustments to accruals (see table above)
$
57.2

 
$
1.7

Acquisition expenses
6.9

 
13.0

Integration expenses
50.0

 
16.9

Net property, plant and equipment
182.0

 
(0.5
)
Severance and other employee expense
2.9

 
0.4

Equipment and inventory relocation costs
1.2

 
0.9

Facility carrying costs
16.4

 
3.1

Other expense
0.4

 
0.2

Total restructuring and other costs, net
$
317.0

 
$
35.7

Schedule of Restructuring Costs Included in Other Expenses 
The expenses in the “Other” segment primarily reflect costs that we consider as related to Corporate that primarily consist of costs incurred as a result of the Combination, the Smurfit-Stone Acquisition, and other acquisition and divestiture expenses, excluding the Specialty Chemicals costs which are included in discontinued operations. The charges in the Net Property, Plant and Equipment column are for the write-off of leasehold improvements associated with the integration of the Combination. The pre-tax charges in the “Other” segment are summarized below (in millions):

 
Acquisition
Expenses
 
Integration
Expenses
 
Other Expenses
 
Total
Current Qtr.
$
1.4

 
$
30.3

 
$
0.4

 
$
32.1

YTD Fiscal 2016
$
6.9

 
$
82.0

 
$
1.3

 
$
90.2

Prior Year Qtr.
$
2.2

 
$
11.1

 
$
—

 
$
13.3

YTD Fiscal 2015
$
13.0

 
$
16.8

 
$
—

 
$
29.8



Acquisition expenses include expenses associated with mergers, acquisitions and other business combinations, whether consummated or not, as well as litigation expenses associated with mergers, acquisitions and business combinations, net of recoveries. Acquisition expenses primarily consist of advisory, legal, accounting, valuation and other professional or consulting fees. Integration expenses reflect primarily severance and other employee costs, professional services including work being performed to facilitate merger and acquisition integration, such as information systems integration costs, lease expense and other costs. Due to the complexity and duration of the integration activities associated with the Combination, the precise amount expected to be incurred has not been quantified in the “Expected Total” in the Summary of Restructuring and Other Costs, Net table above. We expect integration activities to continue during fiscal 2016 and 2017.

Inventories (Tables)
Schedule of inventories
Inventories were as follows (in millions):
 
June 30,
2016
 
September 30,
2015
Finished goods and work in process
$
837.0

 
$
859.7

Raw materials
547.1

 
652.3

Spare parts and supplies
340.9

 
322.4

Inventories at FIFO cost
1,725.0

 
1,834.4

LIFO reserve
(33.9
)
 
(73.4
)
Net inventories
$
1,691.1

 
$
1,761.0

Property, Plant and Equipment (Tables)
Property, Plant and Equipment [Table Text Block]
Property, plant and equipment, net consists of the following (in millions):    
 
June 30,
2016
 
September 30,
2015
Property, plant and equipment at cost:
 
 
 
Land and buildings
$
2,295.9

 
$
2,245.2

Machinery and equipment
10,540.1

 
9,712.4

Forestlands and mineral rights
202.1

 
161.3

Transportation equipment
26.2

 
20.2

Leasehold improvements
62.9

 
59.1

 
13,127.2

 
12,198.2

Less accumulated depreciation and amortization
(3,782.0
)
 
(3,038.4
)
Property, plant and equipment, net
$
9,345.2

 
$
9,159.8

Debt (Tables)
Components of debt
The following were individual components of debt (in millions):
 
June 30, 2016
 
September 30, 2015
 
Carrying Value
 
Weighted Avg. Interest Rate
 
Carrying Value
 
Weighted Avg. Interest Rate
U.S. Dollar Denominated Fixed Rate Debt:
 
 
 
 
 
 
 
Public bonds due fiscal 2017 to 2022
$
1,656.3

 
3.9
%
 
$
1,672.2

 
3.8
%
Public bonds due fiscal 2023 to 2027
414.6

 
4.3
%
 
436.8

 
4.4
%
Public bonds due fiscal 2030 to 2033
991.3

 
4.7
%
 
1,002.8

 
4.6
%
Public bonds due fiscal 2037 to 2047
179.4

 
5.9
%
 
180.1

 
5.9
%
 
 
 
 
 
 
 
 
U.S. Dollar Denominated Floating Rate Debt:
 
 
 
 
 
 
 
Term loan facilities
2,195.5

 
1.7
%
 
1,794.7

 
1.4
%
Revolving credit and swing facilities
62.9

 
1.1
%
 
64.1

 
2.6
%
Receivables-backed financing facility
—

 
—

 
198.0

 
0.9
%
 
 
 
 
 
 
 
 
Capital lease obligations
185.1

 
4.2
%
 
165.8

 
5.7
%
 
 
 
 
 
 
 
 
Supplier Financing and Commercial Card Programs
104.5

 
—

 
3.2

 
—

 
 
 
 
 
 
 
 
International and other debt
69.5

 
8.1
%
 
104.2

 
7.4
%
Total debt
5,859.1

 
3.2
%
 
5,621.9

 
3.3
%
Less current portion of debt
345.2

 
 
 
63.7

 
 
Long-term debt due after one year
$
5,513.9

 
 
 
$
5,558.2

 
 

Fair Value Accounts Receivable Sales Agreement Rollforward (Tables)
Accounts Receivable Sales Agreement Rollforward [Table Text Block]
The following table represents a summary of the activity under the A/R Sales Agreement for the nine months ended June 30, 2016 and June 30, 2015 (in millions):

 
Nine Months Ended
 
June 30,
 
2016
 
2015
Receivable from financial institution at beginning of fiscal year
$
5.8

 
$
10.4

Receivables sold to the financial institution and derecognized
1,095.1

 
897.6

Receivables collected by financial institution
(987.0
)
 
(797.2
)
Cash proceeds from financial institution
(97.2
)
 
(66.4
)
Receivable from financial institution at June 30,
$
16.7

 
$
44.4

Retirement Plans (Tables)
Summary of components of net pension cost and summary of components of postretirement benefit costs
The following table represents a summary of the components of the postretirement benefits costs (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Service cost
$
0.4

 
$
0.1

 
$
1.7

 
$
0.4

Interest cost
1.9

 
1.1

 
6.0

 
3.2

Amortization of net actuarial gain
(0.8
)
 
(0.2
)
 
(1.4
)
 
(0.8
)
Amortization of prior service credit
(0.5
)
 
(0.4
)
 
(1.5
)
 
(1.4
)
Curtailment gain recognized
—

 
(0.4
)
 
—

 
(8.5
)
Postretirement plan cost (benefit)
$
1.0

 
$
0.2

 
$
4.8

 
$
(7.1
)

The following table represents a summary of the components of net pension (benefit) cost (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Service cost
$
8.2

 
$
7.0

 
$
41.7

 
$
22.6

Interest cost
78.2

 
45.1

 
232.9

 
141.5

Expected return on plan assets
(103.3
)
 
(61.3
)
 
(309.3
)
 
(187.6
)
Amortization of net actuarial loss
2.9

 
10.0

 
8.2

 
27.1

Amortization of prior service cost
1.0

 
0.9

 
2.9

 
2.0

Curtailment gain recognized
—

 
—

 
(1.0
)
 
—

Settlement loss recognized
—

 
—

 
—

 
20.0

Company defined benefit plan (benefit) cost
(13.0
)
 
1.7

 
(24.6
)
 
25.6

Multiemployer and other plans
1.6

 
1.5

 
4.4

 
4.3

Net pension (benefit) cost
$
(11.4
)
 
$
3.2

 
$
(20.2
)
 
$
29.9


Share-Based Compensation (Tables)
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] 
The table below summarizes the changes in unvested restricted stock awards during the nine months ended June 30, 2016:
 
Shares / Units
 
Weighted Average
Grant Date Fair
Value
Unvested at September 30, 2015
2,327,231

 
$
56.13

Granted(1)
1,739,953

 
35.74

Vested
(1,499,818
)
 
49.60

Forfeited
(79,266
)
 
51.11

Adjustment due to the Separation
302,180

 
 
Unvested at June 30, 2016 (2)
2,790,280

 
$
41.11

(1)
Fiscal 2016 target awards to employees of 1,191,062 shares may be increased to 200% of the target or decreased to zero, subject to the level of performance attained. The awards are reflected in the table at the target award amount of 100%. In connection with the Combination, the performance condition for the 2013 fiscal grant was based on the Cash Flow to Equity Ratio (as defined in the applicable grant letter). The performance goal was subsequently determined in accordance with the applicable grant letter to be attained at 200.0% of target. Awards issued during the nine months ended June 30, 2016 also include shares accelerated for terminated employees as a result of the Combination which were achieved at between 146.5% and 200% of target. Awards granted for attainment of a performance condition at an amount in excess of target resulted in the issuance and vesting of an additional 446,553 shares in the nine months ended June 30, 2016.

(2)
Target awards with a performance condition, net of subsequent forfeitures, granted may be increased up to 200% of the target or decreased to zero, subject to the level of performance attained. The awards are reflected in the table at the target award amount of 100%. Based on current facts and assumptions, we are forecasting the performance of the grants to be attained at levels that would result in the issuance of approximately 1.5 million additional shares. However, it is possible that the actual performance attained may vary.
Schedule of Share-based Compensation, Stock Options and SARs, Activity [Table Text Block] 
The table below summarizes the changes in all SARs during the nine months ended June 30, 2016:
 
SARs
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Term
 (in years)
 
Aggregate
Intrinsic
Value
(in millions)
Outstanding at September 30, 2015
86,419

 
$
28.98

 
 
 
 
Granted
—

 
—

 
 
 
 
Exercised
(6,840
)
 
31.93

 
 
 
 
Expired
(14,742
)
 
24.29

 
 
 
 
Forfeited
—

 
—

 
 
 
 
Adjustment due to the Separation

8,183

 
 
 
 
 
 
Outstanding at June 30, 2016
73,020

 
$
26.41

 
4.4
 
$
0.9

Exercisable at June 30, 2016
73,020

 
$
26.41

 
4.4
 
$
0.9

The table below summarizes the changes in all stock options during the nine months ended June 30, 2016:

 
Options
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Term
 (in years)
 
Aggregate
Intrinsic
Value
(in millions)
Outstanding at September 30, 2015
7,189,654

 
$
33.19

 
 
 
 
Granted
1,249,790

 
33.38

 
 
 
 
Exercised
(665,214
)
 
31.22

 
 
 
 
Expired
(44,584
)
 
35.04

 
 
 
 
Forfeited
(27,392
)
 
38.82

 
 
 
 
Adjustment due to the Separation

930,865

 
 
 
 
 
 
Outstanding at June 30, 2016
8,633,119

 
$
29.76

 
5.2
 
$
92.5

Exercisable at June 30, 2016
6,937,039

 
$
28.55

 
4.2
 
$
80.0


Segment Information (Tables)
Certain operating data for segments 
The following table shows selected operating data for our segments (in millions):
 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
 
2016
 
2015
 
2016
 
2015
Net sales (aggregate):
 
 
 
 
 
 
 
Corrugated Packaging
$
1,967.7

 
$
1,887.3

 
$
5,864.8

 
$
5,529.6

Consumer Packaging
1,635.8

 
690.2

 
4,766.4

 
2,098.1

Land and Development
42.0

 
—

 
76.1

 
—

Total
$
3,645.5

 
$
2,577.5

 
$
10,707.3

 
$
7,627.7

Less net sales (intersegment):
 
 
 
 
 
 
 
Corrugated Packaging
$
31.4

 
$
29.7

 
$
99.2

 
$
93.4

Consumer Packaging
17.6

 
8.9

 
48.0

 
25.6

Land and Development
—

 
—

 
—

 
—

Total
$
49.0

 
$
38.6

 
$
147.2

 
$
119.0

Net sales (unaffiliated customers):
 
 
 
 
 
 
 
Corrugated Packaging
$
1,936.3

 
$
1,857.6

 
$
5,765.6

 
$
5,436.2

Consumer Packaging
1,618.2

 
681.3

 
4,718.4

 
2,072.5

Land and Development
42.0

 
—

 
76.1

 
—

Total
$
3,596.5

 
$
2,538.9

 
$
10,560.1

 
$
7,508.7

Segment income:
 
 
 
 
 
 
 
Corrugated Packaging
$
192.4

 
$
217.0

 
$
547.5

 
$
571.3

Consumer Packaging
151.7

 
77.9

 
342.6

 
189.3

Land and Development
9.5

 
—

 
6.2

 
—

Segment income
353.6

 
294.9

 
896.3

 
760.6

Pension lump sum settlement and retiree medical curtailment, net
—

 
0.4

 
—

 
(11.5
)
Restructuring and other costs, net
(43.1
)
 
(13.1
)
 
(317.0
)
 
(35.7
)
Non-allocated expenses
(15.3
)
 
(12.7
)
 
(29.0
)
 
(43.5
)
Interest expense
(64.0
)
 
(22.6
)
 
(193.2
)
 
(68.9
)
Interest income and other income (expense), net
20.9

 
(0.7
)
 
43.2

 
(1.0
)
Income from continuing operations before income taxes

$
252.1

 
$
246.2

 
$
400.3

 
$
600.0



Schedule of Goodwill [Table Text Block] 
The changes in the carrying amount of goodwill for the nine months ended June 30, 2016 are as follows (in millions):
 
Corrugated Packaging
 
Consumer
Packaging
 
Land and Development
 
Total
Balances as of September 30, 2015
 
 
 
 
 
 
 
Goodwill
$
1,667.5

 
$
3,022.4

 
$
—

 
$
4,689.9

Accumulated impairment losses
—

 
(42.8
)
 
—

 
(42.8
)
 
1,667.5

 
2,979.6

 
—

 
4,647.1

Goodwill acquired
50.5

 
10.2

 
—

 
60.7

Purchase price allocation adjustments
(3.7
)
 
77.0

 
—

 
73.3

Goodwill disposed of
(24.0
)
 
—

 
—

 
(24.0
)
Foreign exchange translation adjustment
34.7

 
(3.8
)
 
—

 
30.9

Balances as of June 30, 2016
 
 
 
 
 
 
 
Goodwill
1,725.0

 
3,105.8

 
—

 
4,830.8

Accumulated impairment losses
—

 
(42.8
)
 
—

 
(42.8
)
 
$
1,725.0

 
$
3,063.0

 
$
—

 
$
4,788.0

Equity and Other Comprehensive Income (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Parent [Member]
Jun. 30, 2016
Noncontrolling Interest [Member]
Jun. 30, 2016
Maximum [Member]
Jun. 30, 2015
Maximum [Member]
Jun. 30, 2016
Minimum [Member]
Jun. 30, 2015
Minimum [Member]
Jun. 30, 2016
Common Stock [Member]
Sep. 30, 2015
Common Stock [Member]
Jul. 1, 2015
Common Stock [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at beginning of period
 
 
$ 11,783.9 
 
$ 11,651.8 
$ 132.1 1
 
 
 
 
 
 
 
Net (loss) income attributable to common stockholders
 
 
(300.1)
 
(304.3)
4.2 1
 
 
 
 
 
 
 
Other comprehensive income, net of tax
 
 
160.9 
 
160.9 
0 1
 
 
 
 
 
 
 
Noncontrolling interests assumed in acquisition
 
 
10.9 
 
0 
10.9 1
 
 
 
 
 
 
 
Income tax expense from share-based plans
 
 
(12.3)
 
(12.3)
0 1
 
 
 
 
 
 
 
Compensation expense under share-based plans
 
 
52.7 
 
52.7 
0 1
 
 
 
 
 
 
 
Cash dividends declared (per share - $1.125)
 
 
(288.9)2
 
(288.9)2
0 1
 
 
 
 
 
 
 
Distributions and adjustments to noncontrolling interests
 
 
(11.2)
 
0 
(11.2)1
 
 
 
 
 
 
 
Sale of subsidiary shares from noncontrolling interest
 
 
(0.2)
 
0 
(0.2)1
 
 
 
 
 
 
 
Issuance of common stock, net of stock received for minimum tax withholdings
 
 
(3.2)
 
(3.2)
0 1
 
 
 
 
 
 
 
Purchases of common stock
 
 
(285.1)
 
(285.1)
0 1
 
 
 
 
(285.1)
 
 
Separation of Specialty Chemicals business
 
 
(1,084.6)
 
(1,058.5)
(26.1)
 
 
 
 
 
 
 
Balance at end of period
$ 10,022.8 
 
$ 10,022.8 
 
$ 9,913.1 
$ 109.7 1
 
 
 
 
 
 
 
Cash dividends paid per share
$ 0.375 
$ 0.3205 
$ 1.125 
$ 0.8286 
 
 
 
 
 
 
 
 
 
Effective Tax Rate, Net of Tax Components of Other Comprehensive Income
 
 
 
 
 
 
35.00% 
39.00% 
34.00% 
38.00% 
 
 
 
Stock Repurchase Program, Number of Shares Authorized to be Repurchased
 
 
 
 
 
 
 
 
 
 
27.6 
34.6 
40.0 
Authorized Share Repurchase as a Percentage of Common Stock Outstanding
 
 
 
 
 
 
 
 
 
 
 
 
15.00% 
Treasury Stock, Shares, Acquired
 
 
 
 
 
 
 
 
 
 
7.0 
 
 
Equity and Other Comprehensive Income Schedule of Accumulated Other Comprehensive Income (Loss) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Balance at beginning of period
 
 
$ (780.2)1
$ (495.3)1
Other comprehensive (loss) income before reclassifications
 
 
134.3 1
(61.0)1
Amounts reclassified from accumulated other comprehensive loss (income)
 
 
26.6 1
23.8 1
Specialty Chemicals separation
 
 
7.9 1
 
Net current period other comprehensive income (loss)
 
 
168.8 1
(37.2)1
Balance at end of period
(611.4)1
(532.5)1
(611.4)1
(532.5)1
Net actuarial (loss) gain arising during the period
0 
(0.5)
1.4 
(3.3)
Prior service cost (credit) arising during the period
0 
(0.7)
0 
13.2 
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net Unamortized Gain (Loss) Arising During Period, Tax
 
 
(0.8)
2.0 
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Net Prior Service Cost (Credit), Tax
 
 
 
(8.3)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Balance at beginning of period
 
 
(1.4)1
(0.2)1
Other comprehensive (loss) income before reclassifications
 
 
(0.5)1
0 1
Amounts reclassified from accumulated other comprehensive loss (income)
 
 
1.0 1
0 1
Specialty Chemicals separation
 
 
0.4 1
 
Net current period other comprehensive income (loss)
 
 
0.9 1
0 1
Balance at end of period
(0.5)1
(0.2)1
(0.5)1
(0.2)1
Accumulated Defined Benefit Plans Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Balance at beginning of period
 
 
(540.7)1
(498.2)1
Other comprehensive (loss) income before reclassifications
 
 
1.4 1
(16.5)1
Amounts reclassified from accumulated other comprehensive loss (income)
 
 
5.4 1
23.8 1
Specialty Chemicals separation
 
 
1.9 1
 
Net current period other comprehensive income (loss)
 
 
8.7 1
7.3 1
Balance at end of period
(532.0)1
(490.9)1
(532.0)1
(490.9)1
Accumulated Translation Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Balance at beginning of period
 
 
(238.1)1
3.1 1
Other comprehensive (loss) income before reclassifications
 
 
133.4 1
(44.5)1
Amounts reclassified from accumulated other comprehensive loss (income)
 
 
20.2 1
0 1
Specialty Chemicals separation
 
 
5.6 1
 
Net current period other comprehensive income (loss)
 
 
159.2 1
(44.5)1
Balance at end of period
$ (78.9)1
$ (41.4)1
$ (78.9)1
$ (41.4)1
Equity and Other Comprehensive Income Reclassification out of Accumulated Other Comprehensive Income (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Amortization and settlement recognition of net actuarial loss, included in pension cost
$ 1.5 
$ 6.3 
$ 4.9 
$ 29.1 
Amortization and curtailment recognition of prior service (cost) credit, included in pension cost
0.2 
0 
0.8 
(4.9)
Sale of foreign subsidiary, Net of Tax
20.2 
0 
20.2 
0 
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Net of Tax
0.4 
0 
1.0 
0 
Parent [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Amortization of net actuarial loss, Pre-Tax Amount
(1.9)1 2
(9.9)1 2
(6.5)1 3
(46.2)1 3
Amortization of net actuarial loss, Tax
0.6 1 2
3.7 1 2
1.9 1 3
17.5 1 3
Amortization and settlement recognition of net actuarial loss, included in pension cost
(1.3)1 2
(6.2)1 2
(4.6)1 3
(28.7)1 3
Amortization of prior service (cost) credit, Pre-Tax Amount
(0.4)1 2
0 1 2
(1.3)1 3
8.0 1 3
Amortization of prior service (cost) credit, Tax
0.3 1 2
0 1 2
0.5 1 3
(3.1)1 3
Amortization and curtailment recognition of prior service (cost) credit, included in pension cost
(0.1)1 2
0 1 2
(0.8)1 3
4.9 1 3
Defined Benefit Plans, before Tax
(2.3)1
(9.9)1
(7.8)1
(38.2)1
Defined Benefit Plans, Tax
0.9 1
3.7 1
2.4 1
14.4 1
Defined Benefit Plans, Net of Tax
(1.4)1
(6.2)1
(5.4)1
(23.8)1
Sale of foreign subsidiary, Pre-Tax Amount
(20.2)1 4
0 1 4
(20.2)1 4
0 1 4
Sale of foreign subsidiary, Tax
0 1 4
0 1 4
0 1 4
0 1 4
Sale of foreign subsidiary, Net of Tax
(20.2)1 4
0 1 4
(20.2)1 4
0 1 4
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, before Tax
(0.8)1
0 1
(1.6)1
0 1
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Tax
0.2 1
0 1
0.6 1
0 1
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Net of Tax
(0.6)1
0 1
(1.0)1
0 1
Total Reclassifications From Other Comprehensive Income Before Tax
(23.3)1
(9.9)1
(29.6)1
(38.2)1
Total Reclassifications From Other Comprehensive Income Tax Portion
1.1 1
3.7 1
3.0 1
14.4 1
Total Reclassifications From Other Comprehensive Income Net Of Tax
(22.2)1
(6.2)1
(26.6)1
(23.8)1
Commodity Contract [Member] |
Parent [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, before Tax
(0.3)1 5
0 1 5
(1.4)1 5
0 1 5
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Tax
0 1 5
0 1 5
0.5 1 5
0 1 5
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Net of Tax
(0.3)1 5
0 1 5
(0.9)1 5
0 1 5
Foreign Exchange Contract [Member] |
Parent [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, before Tax
(0.5)1 6
0 1 6
(0.2)1 6
0 1 6
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Tax
0.2 1 6
0 1 6
0.1 1 6
0 1 6
Other Comprehensive Income/Loss, Reclassification Adjustment from AOCI on Derivatives, Net of Tax
$ (0.3)1 6
$ 0 1 6
$ (0.1)1 6
$ 0 1 6
Earnings per Share (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Earnings Per Share, Basic and Diluted, by Common Class [Line Items]
 
 
 
 
Income from continuing operations
$ 152.4 
$ 157.9 
$ 241.2 
$ 393.9 
Less: Net income from continuing operations attributable to noncontrolling interest
(0.4)
(1.5)
(1.8)
(2.6)
Income available to common stockholders, before discontinued operations
152.0 
156.4 
239.4 
391.3 
Loss from discontinued operations (1)
(59.7)1
0 1
(543.7)1
0 1
Net income (loss) attributable to common stockholders
92.3 
156.4 
(304.3)
391.3 
Basic weighted average shares outstanding
252.7 
141.1 
254.8 
140.7 
Basic earnings per share from continuing operations
$ 0.60 
$ 1.11 
$ 0.94 
$ 2.78 
Basic loss per share from discontinued operations
$ (0.23)
$ 0.00 
$ (2.13)
$ 0.00 
Basic earnings (loss) per share attributable to common stockholders
$ 0.37 
$ 1.11 
$ (1.19)
$ 2.78 
Net income (loss) attributable to common stockholders
92.3 
156.4 
(304.3)
391.3 
Effect of dilutive stock options and non-participating securities
3.5 
1.6 
3.8 
2.0 
Diluted weighted average shares outstanding
256.2 
142.7 
258.6 
142.7 
Diluted earnings per share from continuing operations
$ 0.59 
$ 1.10 
$ 0.93 
$ 2.74 
Diluted loss per share from discontinued operations
$ (0.23)
$ 0.00 
$ (2.11)
$ 0.00 
Diluted earnings (loss) per share attributable to common stockholders
$ 0.36 
$ 1.10 
$ (1.18)
$ 2.74 
Less: Net income from continuing operations attributable to noncontrolling interest, Discontinued operations
$ (1.0)
 
$ (4.3)
 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
1.9 
0.3 
1.8 
0.4 
Smurfit Stone [Member]
 
 
 
 
Earnings Per Share, Basic and Diluted, by Common Class [Line Items]
 
 
 
 
Weighted average shares reserved
0.3 
0.3 
0.3 
0.3 
Acquisitions (Details) (USD $)
Share data in Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended 0 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Sep. 30, 2015
Apr. 1, 2016
Grupo Gondi Investment [Member]
Apr. 1, 2016
Grupo Gondi Investment [Member]
Jan. 19, 2016
Packaging Acquisition [Member]
Jan. 19, 2016
Packaging Acquisition [Member]
Oct. 1, 2015
SP Fiber [Member]
Oct. 1, 2015
SP Fiber [Member]
Jul. 1, 2015
MeadWestvaco [Member]
Jun. 30, 2015
MeadWestvaco [Member]
Jun. 30, 2015
MeadWestvaco [Member]
Jul. 1, 2015
MeadWestvaco [Member]
Jun. 30, 2015
Pro Forma [Member]
MeadWestvaco [Member]
Jun. 30, 2015
Pro Forma [Member]
MeadWestvaco [Member]
Jan. 19, 2016
Customer Relationships [Member]
Packaging Acquisition [Member]
Oct. 1, 2015
Customer Relationships [Member]
SP Fiber [Member]
Oct. 1, 2015
Customer Relationships [Member]
SP Fiber [Member]
Jul. 1, 2015
Customer Relationships [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Customer Relationships [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Patents [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Patents [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Trademarks [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Trademarks [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Favorable Contracts [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Favorable Contracts [Member]
MeadWestvaco [Member]
Jul. 1, 2015
Maximum [Member]
MeadWestvaco [Member]
Jan. 19, 2016
Maximum [Member]
Customer Relationships [Member]
Packaging Acquisition [Member]
Jul. 1, 2015
Minimum [Member]
MeadWestvaco [Member]
Jan. 19, 2016
Minimum [Member]
Customer Relationships [Member]
Packaging Acquisition [Member]
Jul. 1, 2015
Amounts Recognized As of Acquisition Date [Member]
MeadWestvaco [Member]
Jun. 30, 2016
Measurement Period Adjustments [Member]
MeadWestvaco [Member]
Jun. 30, 2016
Amounts Recognized as of Acquisition Date (as adjusted) [Member]
MeadWestvaco [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payments to Acquire Interest in Joint Venture
 
 
 
 
 
$ 175,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity Method Investment, Ownership Percentage
 
 
 
 
 
 
25.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity Method Investments
 
 
 
 
 
 
300,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pre-Tax Non-Cash Gain in Connection with Investment in Joint Venture
 
 
 
 
 
12,100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unfavorable Contracts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
38,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
3,596,500,000 
2,538,900,000 
10,560,100,000 
7,508,700,000 
 
 
 
 
 
 
 
 
 
 
 
3,654,300,000 
10,730,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percent Ownership in GPS
 
 
 
 
 
 
 
 
 
 
48.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Effective Date of Acquisition
 
 
 
 
 
 
 
Jan. 19, 2016 
 
Oct. 01, 2015 
 
Jul. 01, 2015 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Cost of Acquired Entity, Purchase Price Net of Cash Acquired
 
 
 
 
 
 
 
 
97,600,000 
 
278,800,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10,300,000 
 
13,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities assumed
170,500,000 
 
170,500,000 
 
 
 
 
 
26,100,000 
 
144,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Finite-Lived Intangible Asset, Useful Life
 
 
 
 
 
 
 
 
 
 
 
18 years 9 months 
 
 
 
 
 
 
20 years 0 months 
 
19 years 2 months 
 
9 years 10 months 
 
4 years 6 months 
 
8 years 2 months 
 
20 years 
15 years 0 months 
1 year 
9 years 0 months 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents
 
 
 
 
 
 
 
 
1,700,000 
 
9,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
265,700,000 1
0 2
265,700,000 3
Payment for Debt Owed by GPS
 
 
 
 
 
 
 
 
 
36,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt purchased in connection with an acquisition
36,500,000 
 
36,500,000 
 
 
 
 
 
1,300,000 
 
13,700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Pro Forma Information, Nonrecurring Expense, Acquisition Related Costs
 
 
 
 
 
 
 
 
 
 
 
 
17,400,000 
42,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination
 
 
 
 
 
 
 
 
 
 
 
8,286,700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable
 
 
 
 
 
 
 
 
 
 
 
130.4 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchases of common stock
 
 
285,100,000 
8,700,000 
 
 
 
 
 
 
 
667,800,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common Stock Par Value Per Share of MeadWestvaco
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 0.01 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of MeadWestvaco Shares to WestRock Shares
 
 
 
 
 
 
 
 
 
 
 
 
 
 
78.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares Issued to MeadWestvaco Stockholders
 
 
 
 
 
 
 
 
 
 
 
131.2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value of Equity Awards Issued
 
 
 
 
 
 
 
 
 
 
 
 
 
 
210,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Net of Cash Acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,858,800,000 1
4,800,000 2
1,863,600,000 3
Property, plant and equipment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,991,500,000 1
16,700,000 2
4,008,200,000 3
Prepaid pension asset
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,407,800,000 1
(9,900,000)2
1,397,900,000 3
Goodwill
4,788,000,000 
 
4,788,000,000 
 
4,647,100,000 
 
 
 
10,200,000 
 
50,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3,817,300,000 1
55,300,000 2
3,872,600,000 3
Intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,994,200,000 1
0 2
2,994,200,000 3
Restricted assets held by special purpose entities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,302,000,000 1
0 2
1,302,000,000 3
Other long-term assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
363,800,000 1
18,400,000 2
382,200,000 3
Fair value of assets acquired, including goodwill
583,400,000 
 
583,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
16,001,100,000 1
85,300,000 2
16,086,400,000 3
Current portion of debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
62,300,000 1
74,800,000 2
137,100,000 3
Current liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,099,400,000 1
(47,300,000)2
1,052,100,000 3
Long-term debt due after one year
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,090,600,000 1
18,300,000 2
2,108,900,000 3
Non-recourse liabilities held by special purpose entities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,181,000,000 1
0 2
1,181,000,000 3
Accrued pension and other long-term benefits
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
235,100,000 1
0 2
235,100,000 3
Deferred income tax liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,366,700,000 1
(4,400,000)2
2,362,300,000 3
Other long-term liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
520,000,000 1
43,900,000 2
563,900,000 3
Noncontrolling interest
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
159,300,000 1
0 2
159,300,000 3
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Total Liabilities and Noncontrolling Interest Assumed
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,714,400,000 1
85,300,000 2
7,799,700,000 3
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,286,700,000 1 4
0 2 4
8,286,700,000 3 4
Finite-Lived Intangible Assets, Gross
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,994,200,000 
 
 
 
 
 
 
2,881,700,000 
 
57,200,000 
 
52,900,000 
 
2,400,000 
 
 
 
 
 
 
 
Unfavorable Contracts, Useful Life, Minimum
 
 
 
 
 
 
 
 
 
 
 
1 year 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unfavorable Contracts, Useful Life, Maximum
 
 
 
 
 
 
 
 
 
 
 
9 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjustment to Fair Value Debt Assumed in Business Combination
 
 
 
 
 
 
 
 
 
 
 
 
 
 
364,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjustment to Unamortized Fair Market Value Step-Up
18,300,000 
 
18,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjustment to Fair Value Debt Assumed in Business Combination, Amortization Period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
32 years 
 
1 year 
 
 
 
 
Net income (loss) attributable to common stockholders
$ 92,300,000 
$ 156,400,000 
$ (304,300,000)
$ 391,300,000 
 
 
 
 
 
 
 
 
 
 
 
$ 188,200,000 
$ 483,100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment, Date of Investment
 
 
 
 
 
Apr. 01, 2016 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Discontinued Operations (Details) (USD $)
In Millions, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended
Jun. 30, 2016
May 15, 2016
Sep. 30, 2015
May 15, 2016
Specialty Chemicals Business [Member]
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
Jun. 30, 2016
Specialty Chemicals Business [Member]
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
Jun. 30, 2016
Specialty Chemicals Business [Member]
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
May 16, 2016
Specialty Chemicals Business [Member]
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
Jun. 30, 2016
Capital Lease Obligations [Member]
Secured Debt [Member]
Sep. 30, 2015
Capital Lease Obligations [Member]
Secured Debt [Member]
May 16, 2016
Capital Lease Obligations [Member]
Secured Debt [Member]
Specialty Chemicals Business [Member]
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
 
 
 
 
 
 
Costs Associated with the Closure of Brazil Facility and Other Severance and Stock-Based Compensation Expenses
 
 
 
 
$ 10.0 
 
 
 
 
 
Borrowing By Ingevity in Contemplation of Separation of Business
 
 
 
500.0 
 
 
 
 
 
 
Long-Term Asset for the Estimated Fair Value of Principal and Interest Payments on Capital Lease Obligation Assumed By Ingevity
 
 
 
 
 
 
108.2 
 
 
 
Interest rate
 
 
 
 
 
 
 
 
 
7.67% 
Trust Funded By Company and Assumed by Ingevity to Secure the Principal Payment of Capital Lease Upon Maturity
 
68.9 
 
 
 
 
 
 
 
 
Impairment of Specialty Chemicals goodwill
 
 
 
 
 
478.3 
 
 
 
 
Intangible Asset Impairment
 
 
 
 
 
101.1 
 
 
 
 
Long-term Debt
$ 5,859.1 
 
$ 5,621.9 
 
 
 
 
$ 185.1 
$ 165.8 
$ 80.0 
Discontinued Operations Discontinued Operations (Income Statement Disclosures) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
Income tax benefit, discontinued operations
$ 46.2 
$ 0 
$ 39.0 
$ 0 
Loss from discontinued operations
(58.7)
0 
(539.4)
0 
Specialty Chemicals Business [Member] |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
 
 
 
 
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
Net sales
120.0 
 
533.7 
 
Cost of goods sold
83.8 
 
387.5 
 
Gross Profit
36.2 
 
146.2 
 
Selling, general and administrative, excluding intangible amortization
11.8 
 
65.6 
 
Selling, general and administrative intangible amortization
5.9 
 
28.8 
 
Restructuring and other costs, net
22.5 
 
50.9 
 
Impairment of Specialty Chemicals goodwill and intangibles
101.1 
 
579.4 
 
Operating loss
(105.1)
 
(578.5)
 
Interest income (expense) and other income (expense), net
0.2 
 
0.1 
 
Loss from discontinued operations before income taxes
(104.9)
 
(578.4)
 
Income tax benefit, discontinued operations
46.2 
 
39.0 
 
Loss from discontinued operations
$ (58.7)
 
$ (539.4)
 
Discontinued Operations Discontinued Operations (Depreciation, Amortization and Capital Expenditures) (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
Impairment of Specialty Chemicals goodwill and intangibles
$ 579.4 
$ 0 
Specialty Chemicals Business [Member] |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
 
 
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
Depreciation, depletion and amortization
57.2 
 
Impairment of Specialty Chemicals goodwill and intangibles
579.4 
 
Capital expenditures
$ (43.9)
 
Discontinued Operations Discontinued Operations (Balance Sheet Disclosures) (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2016
Sep. 30, 2015
Jun. 30, 2015
Sep. 30, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
Cash and cash equivalents
$ 0 
$ 20.5 
$ 0 
$ 0 
Current assets of discontinued operations
0 
362.8 
 
 
Long-term assets of discontinued operations
0 
2,255.7 
 
 
Current liabilities of discontinued operations
0 
118.6 
 
 
Long-term liabilities of discontinued operations
0 
361.8 
 
 
Specialty Chemicals Business [Member] |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member]
 
 
 
 
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
Cash and cash equivalents
 
20.5 
 
 
Accounts receivable (net of allowance of $0.1)
 
114.6 
 
 
Inventories
 
202.4 
 
 
Other current assets
 
25.3 
 
 
Current assets of discontinued operations
 
362.8 
 
 
Property, plant and equipment, net
 
436.9 
 
 
Goodwill
 
1,047.4 
 
 
Intangibles, net
 
757.3 
 
 
Other non-current assets
 
14.1 
 
 
Long-term assets of discontinued operations
 
2,255.7 
 
 
Current portion of debt
 
10.4 
 
 
Accounts payable
 
72.4 
 
 
Accrued compensation and benefits
 
3.1 
 
 
Other current liabilities
 
32.7 
 
 
Current liabilities of discontinued operations
 
118.6 
 
 
Long-term debt due after one year
 
0.1 
 
 
Deferred income taxes
 
350.9 
 
 
Other non-current liabilities
 
10.8 
 
 
Long-term liabilities of discontinued operations
 
361.8 
 
 
Disposal Group, Including Discontinued Operation, Allowance for Doubtful Accounts Receivable, Current
 
$ 0.1 
 
 
Restructuring and Other Costs, Net (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
$ 43.1 
$ 13.1 
$ 317.0 
$ 35.7 
Restructuring and Related Cost, Cost Incurred to Date
 
 
710.3 
 
Restructuring and Related Cost, Expected Cost
 
 
715.9 
 
Acquisition Expenses
 
 
6.9 
13.0 
Integration expenses
 
 
50.0 
16.9 
Net Property, Plant and Equipment [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
2.9 1
(2.4)1
182.0 1
(0.5)1
Restructuring and Related Cost, Cost Incurred to Date
 
 
229.4 1
 
Restructuring and Related Cost, Expected Cost
 
 
229.4 1
 
Employee severance and other EE costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
3.8 
0.8 
20.5 
1.0 
Restructuring and Related Cost, Cost Incurred to Date
 
 
53.4 
 
Restructuring and Related Cost, Expected Cost
 
 
53.7 
 
Equipment and Inventory Relocation Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0.4 
0.3 
1.2 
0.9 
Restructuring and Related Cost, Cost Incurred to Date
 
 
9.9 
 
Restructuring and Related Cost, Expected Cost
 
 
11.3 
 
Facility Closing [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
3.5 
1.0 
16.4 
3.1 
Restructuring and Related Cost, Cost Incurred to Date
 
 
32.5 
 
Restructuring and Related Cost, Expected Cost
 
 
35.0 
 
Other Costs Related to Restructuring and Other Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
32.5 
13.4 
96.9 
31.2 
Restructuring and Related Cost, Cost Incurred to Date
 
 
385.1 
 
Restructuring and Related Cost, Expected Cost
 
 
386.5 
 
Corrugated Packaging [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
5.6 2
(1.2)2
221.9 2
3.8 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
329.5 2
 
Restructuring and Related Cost, Expected Cost
 
 
334.1 2
 
Corrugated Packaging [Member] |
Net Property, Plant and Equipment [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
1.4 1 2
(2.5)1 2
181.3 1 2
(0.9)1 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
223.2 1 2
 
Restructuring and Related Cost, Expected Cost
 
 
223.2 1 2
 
Corrugated Packaging [Member] |
Employee severance and other EE costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0.4 2
0.2 2
15.6 2
0.2 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
45.1 2
 
Restructuring and Related Cost, Expected Cost
 
 
45.1 2
 
Corrugated Packaging [Member] |
Equipment and Inventory Relocation Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 2
0.4 2
0.3 2
0.8 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
8.0 2
 
Restructuring and Related Cost, Expected Cost
 
 
8.7 2
 
Corrugated Packaging [Member] |
Facility Closing [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
3.4 2
0.6 2
15.9 2
2.5 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
30.8 2
 
Restructuring and Related Cost, Expected Cost
 
 
33.3 2
 
Corrugated Packaging [Member] |
Other Costs Related to Restructuring and Other Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0.4 2
0.1 2
8.8 2
1.2 2
Restructuring and Related Cost, Cost Incurred to Date
 
 
22.4 2
 
Restructuring and Related Cost, Expected Cost
 
 
23.8 2
 
Consumer Packaging [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
5.4 3
1.0 3
4.9 3
2.1 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
16.5 3
 
Restructuring and Related Cost, Expected Cost
 
 
17.5 3
 
Consumer Packaging [Member] |
Net Property, Plant and Equipment [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
1.5 1 3
0.1 1 3
(0.5)1 3
0.4 1 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
5.0 1 3
 
Restructuring and Related Cost, Expected Cost
 
 
5.0 1 3
 
Consumer Packaging [Member] |
Employee severance and other EE costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
3.4 3
0.6 3
4.0 3
0.8 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
7.4 3
 
Restructuring and Related Cost, Expected Cost
 
 
7.7 3
 
Consumer Packaging [Member] |
Equipment and Inventory Relocation Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0.4 3
(0.1)3
0.9 3
0.1 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
1.9 3
 
Restructuring and Related Cost, Expected Cost
 
 
2.6 3
 
Consumer Packaging [Member] |
Facility Closing [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0.1 3
0.4 3
0.5 3
0.6 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
1.7 3
 
Restructuring and Related Cost, Expected Cost
 
 
1.7 3
 
Consumer Packaging [Member] |
Other Costs Related to Restructuring and Other Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 3
0 3
0 3
0.2 3
Restructuring and Related Cost, Cost Incurred to Date
 
 
0.5 3
 
Restructuring and Related Cost, Expected Cost
 
 
0.5 3
 
All Other Segments [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
32.1 4
13.3 4
90.2 4
29.8 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
364.3 4
 
Restructuring and Related Cost, Expected Cost
 
 
364.3 4
 
Acquisition, Transaction and Other Related Costs
0.4 
0 
1.3 
0 
Acquisition Expenses
1.4 
2.2 
6.9 
13.0 
Integration expenses
30.3 
11.1 
82.0 
16.8 
All Other Segments [Member] |
Net Property, Plant and Equipment [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 1 4
0 1 4
1.2 1 4
0 1 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
1.2 1 4
 
Restructuring and Related Cost, Expected Cost
 
 
1.2 1 4
 
All Other Segments [Member] |
Employee severance and other EE costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 4
0 4
0.9 4
0 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
0.9 4
 
Restructuring and Related Cost, Expected Cost
 
 
0.9 4
 
All Other Segments [Member] |
Equipment and Inventory Relocation Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 4
0 4
0 4
0 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
0 4
 
Restructuring and Related Cost, Expected Cost
 
 
0 4
 
All Other Segments [Member] |
Facility Closing [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
0 4
0 4
0 4
0 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
0 4
 
Restructuring and Related Cost, Expected Cost
 
 
0 4
 
All Other Segments [Member] |
Other Costs Related to Restructuring and Other Costs [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring and other costs, net
32.1 4
13.3 4
88.1 4
29.8 4
Restructuring and Related Cost, Cost Incurred to Date
 
 
362.2 4
 
Restructuring and Related Cost, Expected Cost
 
 
$ 362.2 4
 
[2] The Corrugated Packaging segment current quarter charges primarily reflect restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with the permanent closures of the Coshocton, OH and Uncasville, CT medium mills, the Newberg, OR containerboard and newsprint mill, the Vapi, India linerboard mill, restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The prior year quarter and prior year to date charges primarily reflect on-going closure costs at previously closed facilities net of asset sales. The cumulative charges are primarily associated with the closure of the Coshocton, Uncasville, Newberg, Vapi and Matane, Quebec mills, a recycling facility and the cumulative closure of certain corrugated container plants and recycled collection facilities acquired in the Smurfit-Stone Acquisition, and gains and losses associated with the sale of closed facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.
[3] The Consumer Packaging segment current quarter charges primarily reflect the charges associated with a folding carton and merchandising displays facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with a folding carton and merchandising displays facility, on-going closure costs at previously closed facilities that were partially offset by the gain on sale of the Cincinnati, OH specialty recycled paperboard mill. The prior year quarter and prior year to date charges are primarily associated with on-going closure activity at previously closed facilities including the Cincinnati, OH mill. The cumulative charges primarily reflect our Cincinnati, OH mill and the consolidation of converting and merchandising displays facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.
[4] The expenses in the “Other” segment primarily reflect costs that we consider as related to Corporate that primarily consist of costs incurred as a result of the Combination, the Smurfit-Stone Acquisition, and other acquisition and divestiture expenses, excluding the Specialty Chemicals costs which are included in discontinued operations. The charges in the Net Property, Plant and Equipment column are for the write-off of leasehold improvements associated with the integration of the Combination. The pre-tax charges in the “Other” segment are summarized below (in millions): AcquisitionExpenses IntegrationExpenses Other Expenses TotalCurrent Qtr.$1.4 $30.3 $0.4 $32.1YTD Fiscal 2016$6.9 $82.0 $1.3 $90.2Prior Year Qtr.$2.2 $11.1 $— $13.3YTD Fiscal 2015$13.0 $16.8 $— $29.8Acquisition expenses include expenses associated with mergers, acquisitions and other business combinations, whether consummated or not, as well as litigation expenses associated with mergers, acquisitions and business combinations, net of recoveries. Acquisition expenses primarily consist of advisory, legal, accounting, valuation and other professional or consulting fees. Integration expenses reflect primarily severance and other employee costs, professional services including work being performed to facilitate merger and acquisition integration, such as information systems integration costs, lease expense and other costs. Due to the complexity and duration of the integration activities associated with the Combination, the precise amount expected to be incurred has not been quantified in the “Expected Total” in the Summary of Restructuring and Other Costs, Net table above. We expect integration activities to continue during fiscal 2016 and 2017.
Restructuring and Other Costs, Net Restructuring Accrual (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Restructuring Reserve [Roll Forward]
 
 
Accrual at beginning of period
$ 21.4 
$ 10.9 
Additional accruals
57.1 
0.9 
Payments
(41.0)
(6.5)
Adjustment to accruals
0.1 
0.8 
Accrual at end of period
$ 37.6 
$ 6.1 
Restructuring and Other Costs, Net Restructuring Costs (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Additional accruals and adjustments to accruals (see table above)
 
 
$ 57.2 
$ 1.7 
Acquisition expenses
 
 
6.9 
13.0 
Integration expenses
 
 
50.0 
16.9 
Net property, plant and equipment
 
 
182.0 
(0.5)
Severance and other employee expense
 
 
2.9 
0.4 
Equipment and inventory relocation costs
 
 
1.2 
0.9 
Facility carrying costs
 
 
16.4 
3.1 
Other expense
 
 
0.4 
0.2 
Restructuring and other costs, net
$ 43.1 
$ 13.1 
$ 317.0 
$ 35.7 
Income Taxes (Details)
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Effective tax rates
39.50% 
35.90% 
39.70% 
34.40% 
Inventories (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2016
Sep. 30, 2015
Finished goods and work in process
$ 837.0 
$ 859.7 
Raw materials
547.1 
652.3 
Spare parts and supplies
340.9 
322.4 
Inventories at FIFO cost
1,725.0 
1,834.4 
LIFO reserve
(33.9)
(73.4)
Net inventories
$ 1,691.1 
$ 1,761.0 
Property, Plant and Equipment (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2016
Sep. 30, 2015
Property, Plant and Equipment [Line Items]
 
 
Land and buildings
$ 2,295.9 
$ 2,245.2 
Machinery and equipment
10,540.1 
9,712.4 
Forestlands and mineral rights
202.1 
161.3 
Transportation equipment
26.2 
20.2 
Leasehold improvements
62.9 
59.1 
Property, plant and equipment, at cost
13,127.2 
12,198.2 
Less accumulated depreciation and amortization
(3,782.0)
(3,038.4)
Property, plant and equipment, net
$ 9,345.2 
$ 9,159.8 
Debt (Details) (USD $)
0 Months Ended 0 Months Ended 0 Months Ended
Jun. 30, 2016
Sep. 30, 2015
Jun. 30, 2016
Committed Credit Facilities [Member]
Jun. 30, 2016
Uncommitted Credit Facilities [Member]
Jun. 30, 2016
Notes Due Fiscal 2017 to 2022 [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Notes Due Fiscal 2017 to 2022 [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Term Loan Facilities [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Term Loan Facilities [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Revolving Credit Facility [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Revolving Credit Facility [Member]
Unsecured Debt [Member]
Jun. 22, 2016
Term Loan Facility [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Term Loan Facility [Member]
Unsecured Debt [Member]
Mar. 24, 2016
Term Loan Facility [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Term Loan Facility [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Revolving Credit and Swing Facilities [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Revolving Credit and Swing Facilities [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Farm Credit Facility [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Farm Credit Facility [Member]
Unsecured Debt [Member]
Jul. 1, 2015
Farm Credit Facility [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Receivables Facility [Member]
Secured Debt [Member]
Sep. 30, 2015
Receivables Facility [Member]
Secured Debt [Member]
Jun. 30, 2016
Notes Due Fiscal 2023 to 2027 [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Notes Due Fiscal 2023 to 2027 [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Notes Due Fiscal 2030 to 2033 [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Notes Due Fiscal 2030 to 2033 [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Notes Due Fiscal 2037 to 2047 [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Notes Due Fiscal 2037 to 2047 [Member]
Unsecured Debt [Member]
Jun. 30, 2016
Capital Lease Obligations [Member]
Secured Debt [Member]
Sep. 30, 2015
Capital Lease Obligations [Member]
Secured Debt [Member]
Jun. 30, 2016
Supplier Financing and Commercial Card Programs [Member]
Unsecured Debt [Member]
Sep. 30, 2015
Supplier Financing and Commercial Card Programs [Member]
Unsecured Debt [Member]
Jun. 30, 2016
International and Other Debt [Member]
Sep. 30, 2015
International and Other Debt [Member]
Jun. 30, 2016
Unsecured Debt [Member]
Sumitomo Revolving Line of Credit [Member]
Dec. 1, 2015
Unsecured Debt [Member]
Sumitomo Revolving Line of Credit [Member]
Jun. 30, 2016
Unsecured Debt [Member]
Cooperatieve Rabobank U.A., New York Branch Revolving Line of Credit [Member]
Mar. 4, 2016
Unsecured Debt [Member]
Cooperatieve Rabobank U.A., New York Branch Revolving Line of Credit [Member]
Jun. 30, 2016
Unsecured Debt [Member]
Bank of Tokyo-Mitsubishi UFJ, LTD Line of Credit [Member]
Feb. 11, 2016
Unsecured Debt [Member]
Bank of Tokyo-Mitsubishi UFJ, LTD Line of Credit [Member]
Jul. 1, 2016
Subsequent Event [Member]
Revolving Credit Facility [Member]
Unsecured Debt [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unamortized Fair Market Value Step-Up
$ 329,400,000 
$ 340,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt
5,859,100,000 
5,621,900,000 
 
 
1,656,300,000 
1,672,200,000 
2,195,500,000 
1,794,700,000 
 
 
 
 
 
 
62,900,000 
64,100,000 
 
 
 
0 
198,000,000 
414,600,000 
436,800,000 
991,300,000 
1,002,800,000 
179,400,000 
180,100,000 
185,100,000 
165,800,000 
104,500,000 
3,200,000 
69,500,000 
104,200,000 
 
 
 
 
 
 
 
Current portion of debt
345,200,000 
63,700,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
600,000,000 
 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
62,900,000 
 
0 
 
0 
 
 
Long-term debt due after one year
5,513,900,000 
5,558,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit Facility, maximum borrowing capacity
 
 
 
 
 
 
 
 
 
2,000,000,000 
 
 
 
2,300,000,000 
 
 
 
 
600,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
200,000,000 
 
100,000,000 
 
100,000,000 
 
Amount Which Can Be Drawn On A Delayed Draw Basis Not Later Than Nine Months After the Closing of the Credit Agreement, Amount Drawn Down During Period
 
 
 
 
 
 
 
 
 
 
 
 
600,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Term, in Years
 
 
 
 
 
 
 
 
5 years 
 
 
5 years 
 
 
 
 
7 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Letters of credit outstanding, amount
111,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Receivables backed financing, maximum borrowing amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
700,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Maximum Borrowing Capacity, Amount
 
 
2,500,000,000 
400,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
512,900,000 
555,400,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans and Leases Receivable, Collateral for Secured Borrowings
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
732,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt, Weighted Average Interest Rate
3.20% 
3.30% 
 
 
3.90% 
3.80% 
1.70% 
1.40% 
 
 
 
 
 
 
1.10% 
2.60% 
 
 
 
0.00% 
0.90% 
4.30% 
4.40% 
4.70% 
4.60% 
5.90% 
5.90% 
4.20% 
5.70% 
0.00% 
0.00% 
8.10% 
7.40% 
 
 
 
 
 
 
 
Amount Which Can Be Drawn On A Delayed Draw Basis Not Later Than Nine Months After the Closing of the Credit Agreement
 
 
 
 
 
 
 
 
 
 
 
 
 
1,100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Prepayment of Amortization Payments
 
 
 
 
 
 
 
 
 
 
200,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Committed Principal Amount Extended to July 1, 2021
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,820,000,000 
Fair value of debt
$ 6,000,000,000 
$ 5,700,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value Fair Value by Balance Sheet Grouping (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 27, 2016
Feb. 27, 2015
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
 
 
Maximum Eligible Receivables That May Be Sold
 
 
$ 400.0 
$ 300.0 
Receivable from financial institution at beginning of fiscal year
5.8 
10.4 
 
 
Receivables sold to the financial institution and derecognized
1,095.1 
897.6 
 
 
Receivables collected by financial institution
(987.0)
(797.2)
 
 
Cash proceeds from financial institution
(97.2)
(66.4)
 
 
Receivable from financial institution at June 30,
$ 16.7 
$ 44.4 
 
 
Retirement Plans (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Dec. 31, 2014
Jun. 30, 2016
Jun. 30, 2015
Pension Plans, Defined Benefit [Member]
 
 
 
 
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
 
 
 
 
 
Service cost
$ 8.2 
$ 7.0 
 
$ 41.7 
$ 22.6 
Interest cost
78.2 
45.1 
 
232.9 
141.5 
Expected return on plan assets
(103.3)
(61.3)
 
(309.3)
(187.6)
Amortization of net actuarial (gain) loss
2.9 
10.0 
 
8.2 
27.1 
Amortization of prior service (credit) cost
1.0 
0.9 
 
2.9 
2.0 
Curtailment gain recognized
0 
0 
 
1.0 
0 
Settlement loss recognized
0 
0 
 
0 
20.0 
Company defined benefit plan (benefit) cost
(13.0)
1.7 
 
(24.6)
25.6 
Multiemployer and Other Plans, Period Cost
1.6 
1.5 
 
4.4 
4.3 
Net pension (benefit) cost
(11.4)
3.2 
 
(20.2)
29.9 
Contributions by employer to pension and supplemental retirement plans
14.3 
72.9 
 
39.9 
131.1 
Defined Benefit Plan, Benefit Obligation, Period Increase (Decrease)
 
22.1 
 
 
22.1 
Other Postretirement Benefit Plans, Defined Benefit [Member]
 
 
 
 
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
 
 
 
 
 
Service cost
0.4 
0.1 
 
1.7 
0.4 
Interest cost
1.9 
1.1 
 
6.0 
3.2 
Amortization of net actuarial (gain) loss
(0.8)
(0.2)
 
(1.4)
(0.8)
Amortization of prior service (credit) cost
(0.5)
(0.4)
 
(1.5)
(1.4)
Curtailment gain recognized
0 
0.4 
8.1 
0 
8.5 
Postretirement plan cost (benefit)
1.0 
0.2 
 
4.8 
(7.1)
Contributions by employer to pension and supplemental retirement plans
2.2 
2.3 
 
9.3 
8.0 
Defined Benefit Plan, Effect of Settlements and Curtailments on Accumulated Benefit Obligation
 
0.6 
 
 
0.6 
Lump Sum Pension Settlement [Member]
 
 
 
 
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
 
 
 
 
 
Settlement loss recognized
 
 
 
 
20.0 
Defined Benefit Plan, Settlements, Benefit Obligation
 
 
 
 
163.7 
Defined Benefit Plan, Settlements, Plan Assets
 
 
 
 
135.1 
Gain Recorded to Other Comprehensive Income Related to the Settlement and Remeasurement of Pension Offer
 
 
 
 
28.6 
Defined Benefit Plan, Actuarial Gain (Loss)
 
 
 
 
(32.5)
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss), Net Actuarial Gain (Loss), before Tax
 
 
 
 
$ (3.9)
Share-Based Compensation (Details) (USD $)
In Millions, except Share data, unless otherwise specified
9 Months Ended 3 Months Ended 9 Months Ended 0 Months Ended
May 15, 2016
Jun. 30, 2016
Stock Appreciation Rights (SARs) [Member]
Sep. 30, 2015
Stock Appreciation Rights (SARs) [Member]
Jun. 30, 2016
Stock Options [Member]
Jun. 30, 2015
Stock Options [Member]
Jun. 30, 2016
Stock Options [Member]
Jun. 30, 2015
Stock Options [Member]
Sep. 30, 2015
Stock Options [Member]
Feb. 2, 2016
Employee Stock Purchase Plan [Member]
Feb. 2, 2016
Employee Stock Purchase Plan [Member]
Jun. 30, 2016
WestRock 2016 Incentive Stock Plan [Member]
Feb. 2, 2016
WestRock 2016 Incentive Stock Plan [Member]
Jun. 30, 2016
WestRock 2016 Incentive Stock Plan [Member]
Restricted Stock Target Awards Potentially Issuable [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized
 
 
 
 
 
 
 
 
 
2,500,000 
 
9,600,000 
 
Share-based Compensation Arrangement by Share-based Payment Award, Spin-off Adjustment, Conversion Factor
1.12 
 
 
 
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period
 
 
 
 
 
3 years 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Contractual Term, Maximum
 
 
 
 
 
10 years 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value
 
 
 
 
 
$ 8.06 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term
 
 
 
 
 
7 years 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate
 
 
 
 
 
38.30% 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate
 
 
 
 
 
4.50% 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate
 
 
 
 
 
1.60% 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Total Intrinsic Value
 
 
 
$ 2.8 
$ 1.0 
$ 6.1 
$ 4.7 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Stock Appreciation Rights, Exercises in Period, Intrinsic Value
 
0.1 
 
 
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number
 
73,020 
86,419 
8,633,119 
 
8,633,119 
 
7,189,654 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price
 
$ 26.41 
$ 28.98 
$ 29.76 
 
$ 29.76 
 
$ 33.19 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross
 
0 
 
 
 
1,249,790 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price
 
$ 0.00 
 
 
 
$ 33.38 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period
 
(6,840)
 
 
 
(665,214)
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price
 
$ 31.93 
 
 
 
$ 31.22 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period
 
(14,742)
 
 
 
(44,584)
 
 
 
 
 
 
 
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price
 
$ 24.29 
 
 
 
$ 35.04 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Adjustment Due to Spin-Off of Business
 
8,183 
 
 
 
930,865 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period
 
0 
 
 
 
(27,392)
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price
 
$ 0.00 
 
 
 
$ 38.82 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term
 
4 years 5 months 
 
 
 
5 years 2 months 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value
 
0.9 
 
92.5 
 
92.5 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number
 
73,020 
 
6,937,039 
 
6,937,039 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price
 
$ 26.41 
 
$ 28.55 
 
$ 28.55 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term
 
4 years 5 months 
 
 
 
4 years 2 months 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value
 
$ 0.9 
 
$ 80.0 
 
$ 80.0 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant
 
 
 
 
 
 
 
 
 
 
7,900,000 
 
1,300,000 
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Purchase Date
 
 
 
 
 
 
 
 
15.00% 
 
 
 
 
Share-Based Compensation Restricted Stock (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Sep. 30, 2015
Restricted Stock [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value
$ 2.1 
$ 0.1 
$ 54.0 
$ 82.4 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number
2,790,280 1
 
2,790,280 1
 
2,327,231 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
$ 41.11 1
 
$ 41.11 1
 
$ 56.13 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
1,739,953 2
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value
 
 
$ 35.74 2
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period
 
 
(1,499,818)
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value
 
 
$ 49.60 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period
 
 
(79,266)
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
 
 
$ 51.11 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Spin-Off of Business
 
 
302,180 
 
 
Percentage of Performance Based Awards Reflected
 
 
100.00% 
 
 
Additional Shares Expected to Be Issued Based on Current Projection of Performance Target Levels
 
 
1,500,000 
 
 
Restricted Stock, Target Awards, 2016 [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
1,191,062 
 
 
Restricted Stock, Non-Employee Directors [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period
 
 
1 year 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
64,155 
 
 
Restricted Stock, Employee Grants [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period
 
 
3 years 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
1,229,245 
 
 
Restricted Stock [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Percentage of Award Based on Level of Performance Attained, Maximum
 
 
200.00% 
 
 
Percentage of Award Based on Level of Performance Attained, Minimum
 
 
0.00% 
 
 
Restricted Stock, Target Awards, 2013 [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Percentage of Awarded Based on Performance Level Achieved
 
 
200.00% 
 
 
Restricted Stock Accelerated in Connection with the Combination [Member] |
Minimum [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Percentage of Awarded Based on Performance Level Achieved
 
 
146.50% 
 
 
Restricted Stock Accelerated in Connection with the Combination [Member] |
Maximum [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Percentage of Awarded Based on Performance Level Achieved
 
 
200.00% 
 
 
Restricted Stock, Attainment of Performance Condition in Excess of Target [Member]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
446,553 
 
 
[2] Fiscal 2016 target awards to employees of 1,191,062 shares may be increased to 200% of the target or decreased to zero, subject to the level of performance attained. The awards are reflected in the table at the target award amount of 100%. In connection with the Combination, the performance condition for the 2013 fiscal grant was based on the Cash Flow to Equity Ratio (as defined in the applicable grant letter). The performance goal was subsequently determined in accordance with the applicable grant letter to be attained at 200.0% of target. Awards issued during the nine months ended June 30, 2016 also include shares accelerated for terminated employees as a result of the Combination which were achieved at between 146.5% and 200% of target. Awards granted for attainment of a performance condition at an amount in excess of target resulted in the issuance and vesting of an additional 446,553 shares in the nine months ended June 30, 2016.
Commitments and Contingencies (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2016
Commitments and Contingencies [Line Items]
 
Accrual for Environmental Loss Contingencies
$ 16.6 
Guarantor Obligations, Maximum Exposure, Undiscounted
50 
Number of Lawsiuts the Company Has Been Named a Defendant in Asbestos-related Personal Injury Litigation
575 
Guarantor Obligations, Current Carrying Value
5.2 
Other Long Term Liabilities [Member]
 
Commitments and Contingencies [Line Items]
 
Accrual for Environmental Loss Contingencies
8.7 
Other Current Liabilities [Member]
 
Commitments and Contingencies [Line Items]
 
Accrual for Environmental Loss Contingencies
$ 7.9 
Segment Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Jun. 30, 2016
Jun. 30, 2015
Jun. 30, 2016
Jun. 30, 2015
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
$ 3,596.5 
$ 2,538.9 
$ 10,560.1 
$ 7,508.7 
Pension lump sum settlement and retiree medical curtailment, net
0 
0.4 
0 
(11.5)
Restructuring and other costs, net
(43.1)
(13.1)
(317.0)
(35.7)
Interest expense
(64.0)
(22.6)
(193.2)
(68.9)
Interest income and other income (expense), net
20.9 
(0.7)
43.2 
(1.0)
Income from continuing operations before income taxes
252.1 
246.2 
400.3 
600.0 
Operating Segments [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
3,645.5 
2,577.5 
10,707.3 
7,627.7 
Net sales
3,596.5 
2,538.9 
10,560.1 
7,508.7 
Segment Reporting Information, Segment Income
353.6 
294.9 
896.3 
760.6 
Intersegment Eliminations [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
49.0 
38.6 
147.2 
119.0 
Corporate, Non-Segment [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Pension lump sum settlement and retiree medical curtailment, net
0 
0.4 
0 
(11.5)
Non-allocated expenses
(15.3)
(12.7)
(29.0)
(43.5)
Interest expense
(64.0)
(22.6)
(193.2)
(68.9)
Interest income and other income (expense), net
20.9 
(0.7)
43.2 
(1.0)
Corrugated Packaging [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Restructuring and other costs, net
(5.6)1
1.2 1
(221.9)1
(3.8)1
Corrugated Packaging [Member] |
Operating Segments [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
1,967.7 
1,887.3 
5,864.8 
5,529.6 
Net sales
1,936.3 
1,857.6 
5,765.6 
5,436.2 
Segment Reporting Information, Segment Income
192.4 
217.0 
547.5 
571.3 
Corrugated Packaging [Member] |
Intersegment Eliminations [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
31.4 
29.7 
99.2 
93.4 
Consumer Packaging [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Restructuring and other costs, net
(5.4)2
(1.0)2
(4.9)2
(2.1)2
Consumer Packaging [Member] |
Operating Segments [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
1,635.8 
690.2 
4,766.4 
2,098.1 
Net sales
1,618.2 
681.3 
4,718.4 
2,072.5 
Segment Reporting Information, Segment Income
151.7 
77.9 
342.6 
189.3 
Consumer Packaging [Member] |
Intersegment Eliminations [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
17.6 
8.9 
48.0 
25.6 
Land and Development [Member] |
Operating Segments [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
42.0 
0 
76.1 
0 
Net sales
42.0 
0 
76.1 
0 
Segment Reporting Information, Segment Income
9.5 
0 
6.2 
0 
Land and Development [Member] |
Intersegment Eliminations [Member]
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Revenues
$ 0 
$ 0 
$ 0 
$ 0 
[1] The Corrugated Packaging segment current quarter charges primarily reflect restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with the permanent closures of the Coshocton, OH and Uncasville, CT medium mills, the Newberg, OR containerboard and newsprint mill, the Vapi, India linerboard mill, restructuring activities at a recycling facility and on-going closure costs at previously closed facilities. The prior year quarter and prior year to date charges primarily reflect on-going closure costs at previously closed facilities net of asset sales. The cumulative charges are primarily associated with the closure of the Coshocton, Uncasville, Newberg, Vapi and Matane, Quebec mills, a recycling facility and the cumulative closure of certain corrugated container plants and recycled collection facilities acquired in the Smurfit-Stone Acquisition, and gains and losses associated with the sale of closed facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.
[2] The Consumer Packaging segment current quarter charges primarily reflect the charges associated with a folding carton and merchandising displays facility and on-going closure costs at previously closed facilities. The year to date charges primarily reflect the charges associated with a folding carton and merchandising displays facility, on-going closure costs at previously closed facilities that were partially offset by the gain on sale of the Cincinnati, OH specialty recycled paperboard mill. The prior year quarter and prior year to date charges are primarily associated with on-going closure activity at previously closed facilities including the Cincinnati, OH mill. The cumulative charges primarily reflect our Cincinnati, OH mill and the consolidation of converting and merchandising displays facilities. We have transferred a substantial portion of each closed facility's production to our other facilities.
Segment Information Changes in Carrying Amount of Goodwill (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Jun. 30, 2016
Sep. 30, 2015
Goodwill [Line Items]
 
 
Goodwill
$ 4,788.0 
$ 4,647.1 
Corrugated Packaging [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, Gross
1,725.0 
1,667.5 
Goodwill, Impaired, Accumulated Impairment Loss
0 
0 
Goodwill
1,725.0 
1,667.5 
Goodwill, Acquired During Period
50.5 
 
Goodwill, Purchase Accounting Adjustments
(3.7)
 
Goodwill, Amount Disposed Of
(24.0)
 
Goodwill, Translation Adjustments
34.7 
 
Consumer Packaging [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, Gross
3,105.8 
3,022.4 
Goodwill, Impaired, Accumulated Impairment Loss
(42.8)
(42.8)
Goodwill
3,063.0 
2,979.6 
Goodwill, Acquired During Period
10.2 
 
Goodwill, Purchase Accounting Adjustments
77.0 
 
Goodwill, Amount Disposed Of
0 
 
Goodwill, Translation Adjustments
(3.8)
 
Land and Development [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, Gross
0 
0 
Goodwill, Impaired, Accumulated Impairment Loss
0 
0 
Goodwill
0 
0 
Goodwill, Acquired During Period
0 
 
Goodwill, Purchase Accounting Adjustments
0 
 
Goodwill, Amount Disposed Of
0 
 
Goodwill, Translation Adjustments
0 
 
Operating Segments [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, Gross
4,830.8 
4,689.9 
Goodwill, Impaired, Accumulated Impairment Loss
(42.8)
(42.8)
Goodwill
4,788.0 
4,647.1 
Goodwill, Acquired During Period
60.7 
 
Goodwill, Purchase Accounting Adjustments
73.3 
 
Goodwill, Amount Disposed Of
(24.0)
 
Goodwill, Translation Adjustments
$ 30.9