smurfit stone container 2006_AR

Driving changeSmurfi t-Stone Container Corporation

2006 ANNUAL REPORT

Delivering

resultsSmurfi t-Stone is structured for growth in 2007.

The company achieved signifi cant operating earnings improvement in 2006. Despite infl ation on key input

costs, we delivered solid results that refl ected improved product pricing, excellent supply chain management,

and benefi ts from our strategic initiatives.

SMURFIT-STONE CONTAINER CORPORATION 1

Company Profi leSmurfi t-Stone Container Corporation’s innovative packaging solutions help our customers grow

their businesses and profi ts. As North America’s premier packaging company, Smurfi t-Stone

(NASDAQ: SSCC) is the industry’s leading integrated manufacturer of paperboard and paper-based

packaging. Smurfi t-Stone also is one of the world’s largest paper recyclers. The company has led

the industry in safety performance every year since 2001 and conducts its business in compliance

with the environmental, health and safety principles of the American Forest & Paper Association.

Smurfi t-Stone operated approximately 180 facilities and employed approximately 25,200 people

at year-end 2006.

Financial Highlights

(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) 2006 2005 2004

summary of operating resultsNet sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,157 . . . . . . . . . . . . . $ 6,812 . . . . . . . . . . . . . $ 6,716Containerboard and corrugated containers segment profi t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 433 . . . . . . . . . . . . . 191 . . . . . . . . . . . . . 321Loss from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (70) . . . . . . . . . . . . . (378) . . . . . . . . . . . . . (100)Net loss available to common stockholders . . . . . . . . . . . . . . . . . (71) . . . . . . . . . . . . . (339) . . . . . . . . . . . . . (57)

basic and diluted earnings per shareLoss from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (.32) . . . . . . . . . . . . . $ (1.53) . . . . . . . . . . . . . $ (.44)Net loss available to common stockholders . . . . . . . . . . . . . . . . . (.28) . . . . . . . . . . . . . (1.33) . . . . . . . . . . . . . (.23)Weighted average shares outstanding (in millions) . . . . . . . 255 . . . . . . . . . . . . . 255 . . . . . . . . . . . . . 253

other financial dataNet cash provided by operating activities . . . . . . . . . . . . . . . . . . . $ 265 . . . . . . . . . . . . . $ 221 . . . . . . . . . . . . . $ 273Capital investments and acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . 274 . . . . . . . . . . . . . 285 . . . . . . . . . . . . . 232Proceeds from property disposals and sale of businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 980 . . . . . . . . . . . . . 8 . . . . . . . . . . . . . 32Working capital, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (141) . . . . . . . . . . . . . (4) . . . . . . . . . . . . . 148Property, plant, equipment and timberland, net . . . . . . . . . . 3,774 . . . . . . . . . . . . . 4,289 . . . . . . . . . . . . . 4,682Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,777 . . . . . . . . . . . . . 9,114 . . . . . . . . . . . . . 9,583Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,634 . . . . . . . . . . . . . 4,571 . . . . . . . . . . . . . 4,498Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,807 . . . . . . . . . . . . . 1,882 . . . . . . . . . . . . . 2,259

Number of employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,200 . . . . . . . . . . . . . 33,500 . . . . . . . . . . . . . 35,300

2-5 smurfit-stone at a glance6-9 letter to stockholders: delivering on strategies for results

10-15 delivering results: customer satisfaction16 board of directors, corporate officers and division officers

17 smurfit-stone container corporation form 10-kinside back cover stockholder information

Containerboard and Corrugated Containerscontainerboard facilities products and services

Smurfi t-Stone is the world’s largest containerboard producer and a supplier of market pulp. It produces a full line of commodity and specialty paperboards for conversion into corrugated containers and related products. The containerboard operations consumed approximately 2.6 million tons of reclaimed fi ber in 2006, and Smurfi t-Stone is one of the largest producers of 100 percent recycled containerboard products.

2006 production:

Containerboard . . . . . . . . . . . . . . . . . 7,402,000 tons Bleached liner / solid bleached sulfate . . . . . . . . 313,000 tons

Market pulp . . . . . . . . . . . . . . . . . . . . . 564,000 tons Kraft paper . . . . . . . . . . . . . . . . . . . . . . 199,000 tons

corrugated containers facilities

Smurfi t-Stone is the industry’s leading supplier of corrugated containers, which are made from high-quality linerboard and corrugating medium supplied by SSCC’s network of paper mills. SSCC is a trusted supplier to hundreds of national and international manufacturers, as well as thousands of local and regional customers.

80 billion square feet sold 5.3 million tons converted

Recycling Operationsrecycling facilities products and services

To serve our recycling-based mills, Smurfi t-Stone has built one of the largest reclamation businesses in the industry and handled more than 6.6 million tons of recycled paper in 2006.

Recycled volume processed: Recovered fi ber . . . . . . . . . . . . . . . . . 6,614,000 tons Non-fi ber . . . . . . . . . . . . . . . . . . . . . . . . 128,000 tons

Total . . . . . . . . . . . . . . . . . . . . . . . . . 6,742,000 tons Open-market shipments . . . . . . . . 4,153,000 tons

In 2006, Smurfi t-Stone’s containerboard operations, consisting of 19 mills, produced a wide range of paper grades including:

Kraft linerboard Corrugated medium White top linerboard Solid bleached sulfate Solid bleached linerboard Specialty bleached paperboard Bleached pulp Kraft paper Market pulp

Innovative packaging solutions High-quality graphics Full range of corrugated container products

Graphic and structural design expertise

Point-of-purchase (P-O-P) display consulting, design, and manufacturing Preprint and post-print fl exography and label applications

Full line of specialty products and custom die-cut boxes to display packaged merchandise

Bulk packaging Packaging equipment Packaging systems Corrugated pallets Multiwall boxes Bag-in-box containers Product testing Radio frequency identifi cation Branding support Contract packaging Lamination Research and development Supply chain management Forest resources Pulp and paper services Board sales technical support

At year-end 2006, Smurfi t-Stone operated the following recycling facilities:

23 collection centers 12 sales offi ces (one in China)

Old corrugated containers Double-lined kraft Old newspapers Aluminum, glass and plastic

Smurfi t-Stone Waste Reduction Services (SWRS) is a single-source waste management and recycling service.

2006 ANNUAL REPORT2

Smurfi t-Stone operated 136 corrugated container facilities at year-end 2006, as well as four packaging solutions centers and one training facility. These plants provide high-quality products, top-tier customer service, and unparalleled geographic reach with operations in 31 states, Canada, Mexico and Puerto Rico.

Smurfi t-Stone has equity ownership in three Asian corrugated container facilities, as well as two sheet plants and a lithographic printing plant.

Delivering a leaner

structureSmurfi t-Stone implemented a new organizational structure

in 2006, aligned with our cost and revenue objectives. Establishing a more effective organizational structure was a top priority when we launched our strategic initiatives, and it still is.

The company has made great progress in this area.

We have moved to a functional alignment in our sales and manufacturing operations, as well as corporate support roles,

and we have strengthened our management team by bringing in new leaders and promoting our existing top performers.

smurfit-stone at a glance


smurfit-stone at a glance

Delivering

innovationWhether it’s corrugated packaging, mill products,

recycling services, point-of-purchase displays, packaging equipment, or supply chain solutions,

Smurfi t-Stone delivers innovative and value-added products and services to our customers.

Innovative Displays

Smurfi t-Stone’s display group is a full-service organization

that understands the complexity and service needs of consumer

products companies. Most importantly, we know how to help

our customers sell more product. Our commitment to customers

is to provide responsive, fl exible service supported by our sales

promotion centers and excellent working relationships with

major retailers.

We believe in partnering with our customers in a way that allows

us to better understand their needs and, in turn, provide tailored

display solutions. We can help shorten lead time, reduce costs

and increase productivity through thoughtful analysis and

insightful recommendations. Smurfi t-Stone understands that

consultation, graphic design, and structural design are all key

components to the overall display creation process.

2006 ANNUAL REPORT4

Innovative PackagingMETA™ systems

The way a product looks on the shelf has a great deal

to do with how quickly that product moves off the shelf.

Smurfi t-Stone’s META™ corrugated packaging system

creates a case that translates into a true marketing

advantage with four-, six- and eight-sided confi gurations

and enhanced graphics for maximum shelf impact.

META™ packaging delivers increased stacking

strength with reduced material usage.


Innovative SolutionsSmartDisplay™

Consumer goods companies are interested

in electronic shelf labeling as a tool to

measure point-of-purchase (P-O-P) perfor-

mance, better manage inventory and potential

shrinkage, and increase sales by ensuring that

store shelves are always stocked with their

products. To meet this need, Smurfi t-Stone has

developed SmartDisplay™, which has integrated

radio frequency identifi cation (RFID)

antennas and readers into the corrugated

display. When stocked with RFID-tagged

product, SmartDisplay™ enables retailers to

obtain real-time data on P-O-P performance.

With SmartDisplay™, retailers can digitally detect

when stock is running low and an order for more

product can be automatically placed.

2006 ANNUAL REPORT6

Delivering on

strategiesfor results

dear fellow stockholders: We took bold steps to make important changes to our company

during 2006 and are now in a stronger position to drive improvement and deliver results in 2007.

While we were not satisfi ed with our fi nancial performance, we believe the progress made in 2006 is

not yet fully refl ected in our results. Clearly, 2007 must be the year of execution at Smurfi t-Stone.

Just over a year ago, we redefi ned our strategy to strengthen Smurfi t-Stone’s position as the

industry’s leading paperboard and packaging provider. We launched our strategic initiatives

with four goals that continue to serve as the blueprint for future growth: lowering the cost

structure, driving profi table revenue growth, creating a high-performance team, and improving

fi nancial fl exibility. We plan to invest approximately $400 million in incremental capital as part

of our three-year strategic initiatives program.

Today, Smurfi t-Stone is much better positioned for growth and our three-year transformation

plan is well under way. This transformation plan is designed to deliver cost savings and revenue

growth, with the full benefi t realized by the end of 2008.

We are pleased to report that we are on schedule and have aggressive plans for improved

performance in 2007.

lower our cost structure Smurfi t-Stone achieved $243 million in initiative savings in

2006, exceeding our goal of $240 million; has closed 17 container plants and two mills since

launching initiatives in August 2005; reduced headcount by 2,100 during 2006 and by more

than 3,600 since we kicked off our initiatives; reduced containerboard inventory levels by

12 percent in 2006; increased our capital investments in our container plants; and increased

containerboard production in 2006 by almost 3 percent with two fewer mills.


We expect to deliver incremental initiative savings of $180 million in 2007 to achieve our cost

reduction goal of $525 million by 2008. Our Recycling division exceeded its 2006 strategic

initiatives target and in 2007 will be focused on specifi c efforts to drive profi t improvement and

deliver additional cost savings. A signifi cant portion of our overall 2006 cost reduction success

was driven by improved mill productivity. While we expect continued productivity improvement

in the mills, our Container division’s scaling plan is a critical 2007 initiative. It refl ects best-in-

class manufacturing expertise, from business rebalancing and improved throughput, to machine

and regional plant consolidation. Simply put, our scaling plan calls for an aggressive capital

investment program focused on our box plant system to upgrade the manufacturing base and

increase economies of scale; and we will specialize our manufacturing capabilities at select

plants to support customers that require unique products and services. We will work toward

aggressive goals for improving asset utilization and production.

drive profitable revenue growth We increased segment operating profi t by

$242 million, to $452 million, partly as a result of increases in average containerboard and

corrugated container prices.

We will deliver organic growth during the three-year plan by focusing on our strategic advantage

of industry-leading scale in our marketplace, and by investing in our portfolio of value-added

products and services. We plan to grow the reclamation business in the areas of export and

plastics, as well as with strategic acquisitions and other capital investments.

Smurfi t-Stone is clearly on the right track to leverage the scale and service capabilities of the largest packaging producer in North America. With a dynamic, focused strategy and a strong leadership team in place,

we believe that our best days are ahead of us.

create a high-performance organizational structure Smurfi t-Stone led the industry

in safety performance for the sixth consecutive year and realigned the sales and marketing

organization to better focus on profi table sales growth. We moved to a functional alignment

in our sales and manufacturing operations, as well as corporate support roles, and strengthened

our management team by bringing in new leaders and promoting our existing top performers.

We established a highly skilled new leadership team with more than half of the senior leaders

new to their assignments during the past nine months.

letter to stockholders

2006 ANNUAL REPORT8

letter to stockholders

Smurfi t-Stone’s talent management program is a critical component of the company’s

transformation strategy. With a substantial upgrade in talent, we are more confi dent in our

ability to deliver results. Shifting to a disciplined performance-based compensation program

will reward top leaders appropriately for consistently driving change and delivering results.

improve financial flexibility We decreased debt by $937 million, principally with the

proceeds from the sale of the Consumer Packaging division. We are executing a comprehensive

reinvestment program to modernize container plants. A focused approach to investing in our core

business ensures that we continue to take costs out of our business by improving effi ciencies.

2006 results Smurfi t-Stone’s sales of $7.2 billion were up from the previous year’s

$6.8 billion. For the full year, Smurfi t-Stone reported a net loss available to common stockholders

of $71 million, or $0.28 per diluted share, compared to a net loss available to common stockholders

of $339 million, or $1.33 per diluted share in 2005. In 2006, our loss from continuing operations

was $70 million, or $0.32 per diluted share, compared to a loss from continuing operations of

$378 million, or $1.53 per diluted share in 2005. Operating results for 2006 included restructuring

charges of $0.10 per share compared to $0.82 per share in 2005. 2006 results refl ect the sale

of the company’s Consumer Packaging operation on June 30, 2006.

We achieved signifi cant operating earnings improvement in 2006. Despite infl ation on all key

input costs, we improved our year-over-year performance due to higher prices for our products,

excellent supply chain management and cumulative benefi ts achieved during the fi rst full year

of our strategic initiatives program.

looking ahead Our market is well balanced and inventories remain low while packaging

demand is stable. We expect to deliver improved earnings in 2007 as we continue to achieve

incremental benefi ts from our strategic initiatives. We expect these benefi ts to outstrip

cost pressures.

Smurfi t-Stone is clearly on the right track to leverage the scale and service capabilities of the

largest packaging producer in North America. With a dynamic, focused strategy and a strong

leadership team in place, we believe that our best days are ahead of us.

pat moorechairman and chief executive officer

steve klingerpresident and chief operating officer


pat moorechairman and

chief executive officer

steve klingerpresident and chief operating officer

Delivering improved productivity

mill employees show commitment to continuous improvement Like everyone at Smurfi t-Stone, the employees of our Containerboard Mill division were challenged in 2006 to respond to changes in the economy, the competitive climate, and our strategic initiatives. Mill employees rose to the challenge. Production at our containerboard mills was up nearly three percent over the prior year, despite two mill closures in 2005.

2006 ANNUAL REPORT10


Delivering results: customer

satisfaction

smurfit-stone’s long-term goal is clear We will be the safest and most profi table company

in the industry. Achieving that goal will ensure that we consistently deliver innovative and cost

effective packaging solutions and services to our customers.

Safe work practices are engrained in Smurfi t-Stone’s culture, and represent a core value of

our CustomerONE® operating philosophy. In addition to being the premier provider of packaging

solutions, we are proud to have been recognized every year since 2001 as the safest company in

the industry.

We achieved another year of outstanding safety results in 2006. Smurfi t-Stone’s recordable case

rate (RCR) of 1.15 was our best ever, and refl ects our passion to provide a safe work environment

for all employees, every day.

That passion came to life when the Smurfi t-MBI facility in Edmonton, AB, received the prestigious

“Work Safe Alberta Best Performer Award” from Alberta Human Resources and Employment. This

award recognized the outstanding improvements in safety management as the facility went from

a disappointing 13 reportable incidents in 2001 to one in 2005. Edmonton employees followed

their outstanding 2005 performance with 15 consecutive months without a recordable incident

or near miss.

Our Hodge, LA, mill recently celebrated one million accident-free manhours. The Pulp & Paper

Safety Association reported that only six mills have achieved one million hours worked without a

recordable incident as measured by the Occupational Safety and Health Administration (OSHA),

and four of these mills are from Smurfi t-Stone: Hodge; Stevenson, AL; Brewton, AL; and

West Point, VA.


delivering results: customer satisfaction

Another safety success story is our Nashville, TN, recycling facility, which has worked nine

consecutive years with a 0.0 RCR as measured by OSHA (see more on page 14).

implementing best practices Because a safe operation is a well-run operation, our emphasis

on safety connects directly to our scaling and operational excellence initiatives, which are designed

to help optimize our enterprise at every step.

Our scaling plan involves investing capital in new machinery and technology so that we run

signifi cantly more volume with fewer plants. Scaling also ensures that our container facilities

drive manufacturing specialization to the bottom line.

We are implementing operational excellence to ensure that we are operating at the lowest possible

cost and providing the highest possible value to our customers. Standardization and consistency

are the drivers for achieving and maintaining excellence in the basics — safety, quality, waste

and productivity. Our operational excellence approach details standardized policies, procedures

and processes along with associated metrics, training and talent assessment plans.

strategic investment Just as we are investing in people and processes, we are making strategic

capital investments and shifting high-volume business to the larger, more effi cient facilities

(see page 13). These investments will yield substantial improvements in our manufacturing

capabilities, enabling us to meet and exceed customer expectations at the lowest possible cost.

One of our key operating principles is running production to demand rather than to capacity.

As the fi rst step in the implementation of our strategic initiatives, we eliminated more than a half-

million tons of higher-cost mill capacity. Yet in spite of two mill closures in 2005, we achieved

an even higher level of containerboard production in 2006 due to increased operating effi ciency.

Eliminating outmoded capacity and improving plant productivity alone is not a winning strategy.

We are investing in our future and capitalizing on our large integrated system by driving

economies of scale in the operations.

Ultimately, we plan to reduce our corrugator base by more than 20 machines, to fewer than

90 corrugators. We also plan to eliminate more than 150 converting machines, including rotary

die cutters and fl exo folder gluers. We are encouraged by initial results. For example, our

corrugated container operations delivered shipment levels in 2006 just below those of 2005

despite closing 15 box plants last year.

We are investing in major capital initiatives primarily focused on new or updated state-of-the-art

corrugated operations in key markets such as Atlanta, Dallas and Toronto. These investments

will yield substantial improvement in our manufacturing capabilities and allow us to cost

effectively meet customer demands.

13 SMURFIT-STONE CONTAINER CORPORATION 13

Delivering on capital investment

focused capital investment will let us shift high-volume business to larger plants As part of our strategic initiatives program, Smurfi t-Stone plans to invest approximately $400 million in incremental capital to modernize our manufacturing base and upgrade equipment, allowing us to build a lower cost infrastructure to support profi table growth. By investing in state-of-the-art equipment, implementing best practices, and driving operational effi ciencies, we expect to increase throughput and take better advantage of our economies of scale.

Delivering best safety practices

our winning safety process strives to eliminate all injuries and improve profitability Employees at Smurfi t-Stone’s recycling facility in Nashville, TN, are focused on best safety practices. The plant’s employees have had nine consecutive years with a 0.0 recordable case rate (RCR), as measured by OSHA. It’s no accident that the plant has daily toolbox meetings that stress safety, and has long-time employees who are clearly safety leaders. To ensure that best safety practices permeate our operations, we are giving our plants detailed guidance including creating safety checklists, developing safety leadership teams, conducting daily toolbox meetings, and setting clear expectations on attendance, quality and safe job performance.



sales and marketing Smurfi t-Stone has established a unifi ed, centralized, and focused sales

and marketing organization to unlock the value of our manufacturing and service expertise,

assist our customers in growing their businesses and profi ts, and better position Smurfi t-Stone

for revenue growth. The sales and marketing organization is a great resource for customers on

key issues such as sustainability and innovation, and is focused on delivering superior levels of

customer service, profi table business development, and seamless, value-added coordination

with our manufacturing operations.

internal efficiencies An important source of cost reduction has been greater coordination

among our operating divisions. As an example, our Recycling division developed a cost-savings

program for our Containerboard Mill division by building additional inventories during the

fourth quarter of each year, to be used the following summer.

By running our box operations as one common system, we have reduced the number of grade

combinations required to produce packaging. This has allowed our mills to improve productivity

by producing fewer paper grades. A more simplifi ed, centrally managed supply chain keeps

inventory levels low at the box plants.

We are continuing to address effi ciency improvement opportunities in all our operations, and

in the areas of transportation and procurement.

talent management The new talent management process lays out a disciplined approach to

ensuring that we have the right people in the right jobs. Smurfi t-Stone’s ability to attract top talent

and combine it with the company’s existing top performers will accelerate our transformation and

is critical to achieving our goal of becoming the safest and most profi table company in our industry.

diversity Our ability to win in our industry and to consistently outperform our competitors

depends entirely on the skills, experiences, expertise and commitment of every one of

our employees.

In order to gain a sustainable competitive business advantage, we must have the best and

brightest employees — employees who believe that they really do make a difference when they

come to work every day. Creating a diverse work environment provides a strong foundation for

growth, will help ensure that our workforce population resembles our customer population,

and allows us to more fully understand our customers’ needs.

delivering results: customer satisfaction

patrick j. mooreChairman and Chief Executive Offi cerSmurfi t-Stone Container Corporation

james r. borisRetiredChairman and CEOEVEREN Capital Corp.

connie k. duckworthFounder and PresidentArzu, Inc.

alan e. goldbergCo-Managing PartnerGoldberg Lindsay & Co., LLC

william t. lynch, jr.President and CEO Liam Holdings, LLC

james j. o’connorRetired Chairman and CEO UNICOM Commonwealth Edison

jerry k. pearlmanRetired Chairman and CEO Zenith Electronics

thomas a. reynolds, iiiPartnerWinston & Strawn LLP

eugene c. sitChairman, CEO and Chief Investment Offi cerSit Investment Associates

william d. smithburgRetired Chairman, President and CEOThe Quaker Oats Company

chairman emeritus sir michael w.j. smurfit, kbe

patrick j. mooreChairman and Chief Executive Offi cer

steven j. klingerPresident and Chief Operating Offi cer

roger p. beckerVice President Taxes

jeffrey s. beyersdorferVice President and Treasurer

mathew j. blanchardVice President and General Manager Board Sales Division

christopher j. bresciaVice President Government Affairs

nina e. butlerVice President Environmental Affairs

james s. chouVice President and Division ControllerContainerboard Mill

matthew t. dentonVice President Business Planning and Analysis

ronald d. hackneySenior Vice President Human Resources

charles a. hinrichsSenior Vice President and Chief Financial Offi cer

craig a. huntSenior Vice PresidentSecretary and General Counsel

mack c. jacksonSenior Vice President and General Manager Containerboard Mill Division

paul k. kaufmannSenior Vice President Corporate Controller

douglas m. keimVice President Innovation Chief Marketing Offi cer

john l. knudsenSenior Vice President ManufacturingContainer Division

david f. kosterVice President Transportation and Distribution

joseph v. leblancVice President Research and Development

paul w. mccannVice President Procurement

ronald j. megnaAssistant Secretary

susan m. neumannSenior Vice President Communications

mark r. o’bryanSenior Vice President Strategic Initiatives

michael r. oswaldSenior Vice President and General Manager Recycling Division

thomas a. paganoSenior Vice President Corporate Development

e. lawrence quatmannVice President Internal Audit

steven c. stricklandSenior Vice President Sales Container Division

regina g. wyseVice President and Division ControllerCorrugated Container

containerdaniel j. burgerVice President Strategic Planning

john j. capliceVice President National Sales

gary p. corcoranVice President Sales, Marketing and Business DevelopmentSmurfi t-MBI

john p. crimminRegional Vice President Sales

john n. eatonVice President Packaging Solutions

colin fernieVice President and General Manager Smurfi t-MBI

richard e. flammRegional Vice President Manufacturing

robert a. millerVice President International Sales and Marketing

george a. morettiVice President Sales

w. dwight morrisRegional Vice President Sales

rodney a. myersRegional Vice President Manufacturing

robert d. nelsonRegional Vice President Sales

james s. nolanVice President Corporate Sales, Strategic Merchandising Solutions and Graphics

thomas a. piggottRegional Vice President Sales

frederick j. rossiVice President Operational Excellence

donald r. royRegional Vice President Sales

scott e. shermanRegional Vice President Manufacturing

tim j. sullivanVice President Display and Graphics Sales

bruce j. white Regional Vice President Manufacturing

john t. yoderRegional Vice President Manufacturing

containerboard millalain l.m. boivinVice President Mill OperationsNorthern Region

john e. davisVice President Forest Resources

george q. langstaffVice President Regional Mill Operations

larry t. priceVice President Mill Operations

w. g. stuartVice President Mill OperationsSouthern Region

board saleslarry l. burtonVice President Sales and Marketing

michael l. butlerVice President North American Containerboard Sales

roger m. jansenVice President SBS Sales

brian p. mcgurkVice President Integrated Sales and Sales Management

mark a. polivkaVice President Supply/Demand Operations

eve k. raeVice President Pulp Sales

andrew j. woodroffeVice President Product Management and Technical Services

recyclingmark c. brantleyVice President Eastern Region

richard s. garmsenVice President Western Region

james b. wimbishVice President Operational Excellence

james w. popeVice President International Sales

edward v. tucciaroneVice President Domestic Sales

robert j. curranVice President Business Development

Corporate Offi cers Division Offi cersBoard of Directors


stockholders’ annual meetingMay 9, 2007 at 10 a.m.Chicago Club81 East Van Buren StreetChicago, IL 60605

registrar and transfer agent Mellon Investor Services LLC 480 Washington Boulevard Jersey City, NJ 07310-1900

Telephone: (800) 676-0896

Foreign Stockholders: (201) 680-6610

TDD for Hearing Impaired: (800) 231-5469

TDD Foreign Stockholders: (201) 680-6578

www.melloninvestor.com/isd

common stock Smurfi t-Stone Container Corporation Common Stock is traded on The NASDAQ National Market under the symbol: SSCC.

preferred stock Smurfi t-Stone’s 7% Series A Cumulative Exchangeable Redeemable Convertible Preferred Stock is traded on the NASDAQ Global Select Market under the symbol: SSCCP.

investor information John HaudrichSenior Director, Investor Relations(314) 656-5375

Stephanie MeinersDirector, Investor Relations(314) 656-5371

corporate headquarters Smurfi t-Stone Container Corporation150 North Michigan AvenueChicago, IL 60601

Telephone: (312) 346-6600

Smurfi t-Stone Container CorporationSix CityPlace DriveCreve Coeur, MO 63141

Telephone: (314) 656-5300

www.smurfi t-stone.com

This report was printed on FSC certifi ed Mohawk Paper Mills Options 100% PC Recycled stock and Mohawk Opaque stock, made with 100 percent and 30 percent post-consumer waste respectively. The papers were manufactured entirely with wind-generated electricity and are acid free.

Stockholder Information

Smurfi t-Stone Container Corporation

150 North Michigan AvenueChicago, IL 60601(312) 346-6600

Six CityPlace DriveCreve Coeur, MO 63141

(314) 656-5300

www.smurfi t-stone.com

Economy & Finance

smurfit stone container 2006_AR