# UNITED	STATES

# SECURITIES	AND	EXCHANGE	COMMISSION

# (Mark	One)

☒ ANNUAL	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

# For	the	fiscal	year	ended	September	30,	2018

☐ TRANSITION	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

# WESTROCK	COMPANY

(Exact	Name	of	Registrant	as	Specified	in	Its	Charter)

Delaware

(State	or	Other	Jurisdiction	of Incorporation	or	Organization)

1000	Abernathy	Road	NE,	Atlanta,	Georgia (Address	of	Principal	Executive	Offices)

(Zip	Code)

Registrant's	Telephone	Number,	Including	Area	Code:	(770)	448-2193

# Securities	registered	pursuant	to	Section	12(b)	of	the	Act:

# Title	of	Each	Class

Name	of	Exchange	on	Which	Registered

Common	Stock,	par	value	$0.01	per	share New	York	Stock	Exchange

Securities	registered	pursuant	to	Section	12(g)	of	the	Act:	None

Indicate	by	check	mark	if	the	registrant	is	a	well-known	seasoned	issuer,	as	defined	in	Rule	405	of	the	Securities	Act.	Yes	☒					No	☐

Indicate	by	check	mark	if	the	registrant	is	not	required	to	file	reports	pursuant	to	Section	13	or	Section	15(d)	of	the	Act.	Yes	☐			No	☒

Indicate	by	check	mark	whether	the	registrant	(1)	has	filed	all	reports	required	to	be	filed	by	Section	13	or	15(d)	of	the	Securities	Exchange	Act	of	1934	during	the	preceding	12 months	(or	for	such	shorter	period	that	the	registrant	was	required	to	file	such	reports),	and	(2)	has	been	subject	to	such	filing	requirements	for	the	past	90	days.				Yes	☒			No	☐

Indicate	by	check	mark	whether	the	registrant	has	submitted	electronically	every	Interactive	Data	File	required	to	be	submitted	pursuant	to	Rule	405	of	Regulation	S-T	(§	232.405 of	this	chapter)	during	the	preceding	12	months	(or	for	such	shorter	period	that	the	registrant	was	required	to	submit	such	files).			Yes	☒				No	☐

Indicate	by	check	mark	if	disclosure	of	delinquent	filers	pursuant	to	Item	405	of	Regulation	S-K	(§	232.405	of	this	chapter)	is	not	contained	herein,	and	will	not	be	contained,	to	the best	of	the	registrant's	knowledge,	in	definitive	proxy	or	information	statements	incorporated	by	reference	in	Part	III	of	this	Form	10-K	or	any	amendment	to	this	Form	10-K.			☒

Indicate	by	check	mark	whether	the	registrant	is	a	large	accelerated	filer,	an	accelerated	filer,	a	non-accelerated	filer,	a	smaller	reporting	company	or	an	emerging	growth company.	See	the	definitions	of	"large	accelerated	filer,"	"accelerated	filer,"	"smaller	reporting	company"	and	"emerging	growth	company"	in	Rule	12b-2	of	the	Exchange	Act.

Large	accelerated	filer	☒

Non-accelerated	filer	☐

Accelerated	filer	☐

Smaller	reporting	company	☐

Emerging	growth	company	☐

If	an	emerging	growth	company,	indicate	by	check	mark	if	the	registrant	has	elected	not	to	use	the	extended	transition	period	for	complying	with	any	new	or	revised	financial accounting	standards	provided	pursuant	to	Section	13(a)	of	the	Exchange	Act.	☐

Indicate	by	check	mark	whether	the	registrant	is	a	shell	company	(as	defined	in	Rule	12b-2	of	the	Exchange	Act).					Yes			☐					No			☒

The	aggregate	market	value	of	the	common	equity	held	by	non-affiliates	of	the	registrant	as	of	March	31,	2018	(based	on	the	closing	price	per	share	as	reported	on	the	New	York Stock	Exchange	on	such	date),	was	approximately	$16,230	million.

# DOCUMENTS	INCORPORATED	BY	REFERENCE

Portions	of	the	definitive	Proxy	Statement	for	the	Annual	Meeting	of	Stockholders	to	be	held	on	February	1,	2019	are	incorporated	by	reference	in	Part	III.

# EXPLANATORY	NOTE

On	November	2,	2018,	pursuant	to	the	Agreement	and	Plan	of	Merger	(the	" Merger	Agreement"),	dated	as	of	January	28,	2018,	among	WRKCo	Inc. (formerly	known	as	WestRock	Company)	("WRKCo"),	KapStone	Paper	and	Packaging	Corporation	(" KapStone"),	WestRock	Company	(formerly	known	as Whiskey	Holdco,	Inc.)	(the	"Company"	or	"WestRock"),	Whiskey	Merger	Sub,	Inc.	and	Kola	Merger	Sub,	Inc.,	the	Company	acquired	all	of	the	outstanding shares	of	KapStone	through	a	transaction	in	which:	(i)	Whiskey	Merger	Sub,	Inc.	merged	with	and	into	WRKCo,	with	WRKCo	surviving	such	merger	as	a wholly	owned	subsidiary	of	the	Company	(the	"WestRock	Merger")	and	(ii)	Kola	Merger	Sub,	Inc.	merged	with	and	into	KapStone,	with	KapStone	surviving such	merger	as	a	wholly	owned	subsidiary	of	the	Company	(the	"KapStone	Merger"	and,	together	with	the	WestRock	Merger,	the	" Mergers").	As	a	result of	the	Mergers,	among	other	things,	the	Company	became	the	ultimate	parent	of	WRKCo,	KapStone	and	their	respective	subsidiaries.	Effective	as	of	the effective	time	of	the	Mergers	(the	"Effective	Time"),	the	Company	changed	its	name	to	"WestRock	Company"	and	WRKCo	changed	its	name	to	"WRKCo Inc.".	See	Part	I,	Item	7.	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	—	Overview "	and	"Note	23. Subsequent	Events	(Unaudited)"	of	the	Notes	to	Consolidated	Financial	Statements for	more	information.

The	shares	of	both	WRKCo	common	stock	and	KapStone	common	stock	were	suspended	 from	 trading	on	 the	New	York	Stock	Exchange	(the "NYSE")	prior	to	the	open	of	trading	on	November	5,	2018.	Shares	of	Company	common	stock	continued	regular-way	trading	on	the	NYSE	using	WRKCo's trading	history	under	the	ticker	symbol	"WRK"	immediately	following	the	suspension	of	trading	of	WRKCo	common	stock.

The	Company	is	the	successor	issuer	to	both	WRKCo	and	KapStone	pursuant	to	Rule	12g-3(c)	under	the	Securities	Exchange	Act	of	1934,	as amended	(the	"Exchange	Act").	As	a	result	of	the	Mergers	and	subsequent	Form	15	filings,	WRKCo	and	KapStone	are	no	longer	subject	to	the	reporting requirements	of	the	Exchange	Act.	However,	in	order	to	provide	continuity	of	information	to	investors	and	to	meet	the	Company's	obligations	pursuant	to Rule	12b-3(g)	under	the	Exchange	Act,	this	Annual	Report	on	Form	10-K	(the	"Form	10-K")	filed	by	the	Company	under	the	Company's	new	CIK	code	is also	a	complete	Annual	Report	on	Form	10-K	of	the	Company's	predecessor	registrant	WRKCo	with	respect	to	WRKCo's	last	full	fiscal	year	(the	fiscal	year ended	September	30,	2018)	prior	to	the	Mergers	and	contains	all	of	the	information	that	would	have	been	required	had	WRKCO	itself	filed	an	Annual	Report on	Form	10-K	for	the	year	ended	September	30,	2018	prior	to	filing	the	Form	15	suspending	its	reporting	obligations.	Since	the	Mergers	closed	after	the end	of	the	September	30,	2018	fiscal	year	end	covered	by	the	Form	10-K,	the	Form	10-K	reflects	the	results	of	WRKCo	for	periods	prior	to	the	Mergers. Accordingly,	the	historical	financial	results	presented	herein	are	those	of	WRKCo	only	and	do	not	reflect	the	Mergers	or	include	any	results	of	KapStone. WRKCo	was	 the	accounting	acquirer	 in	 the	 transaction;	 therefore,	 the	historical	consolidated	 financial	statements	of	WRKCo	 for	periods	prior	 to	 the Mergers	(including	the	fiscal	year	ended	September	30,	2018)	are	also	considered	to	be	the	historical	financial	statements	of	the	Company.

Whiskey	Holdco,	Inc.	("Whiskey	Holdco")	was	formed	on	January	25,	2018	for	the	purpose	of	effecting	the	Mergers.	At	the	time	of	its	formation	and until	the	consummation	of	the	Mergers,	Whiskey	Holdco	was	a	wholly-owned	subsidiary	of	WRKCo	(then	WestRock	Company).	Prior	to	the	Mergers, Whiskey	Holdco	did	not	conduct	any	activities	other	than	those	incidental	to	its	formation	and	the	matters	contemplated	by	the	Merger	Agreement,	including being	party	to	the	Delayed	Draw	Credit	Agreement	(as	hereinafter	defined).	As	a	wholly-owned	subsidiary	of	WRKCo,	Whiskey	Holdco's	limited	activities are	reflected	in	WRKCo's	consolidated	financial	statements	for	the	fiscal	year	ended	September	30,	2018.	As	a	result,	we	have	not	presented	any	separate financial	 information	 for	 Whiskey	 Holdco,	 including	 a	 consolidated	 balance	 sheet	 at	 September	 30,	 2018,	 or	 a	 consolidated	 statement	 of	 operations, consolidated	statement	of	comprehensive	income	or	consolidated	statement	of	cash	flows	for	the	year	ending	September	30,	2018	as	that	information would	not	be	meaningful.

# INDEX	TO	FORM	10-K

# Reference

|  | PART	I |  |
| :--- | :--- | :--- |
| Item\t1. | Business | 4 |
| Item\t1A. | Risk\tFactors | 16 |
| Item\t1B. | Unresolved\tStaff\tComments | 27 |
| Item\t2. | Properties | 27 |
| Item\t3. | Legal\tProceedings | 29 |
| Item\t4. | Mine\tSafety\tDisclosures | 29 |
|  | PART\tII |  |
| Item\t5. | Market\tfor\tthe\tRegistrant's\tCommon\tEquity,\tRelated\tStockholder\tMatters\tand\tIssuer\tPurchases\tof\tEquity\tSecurities | 30 |
| Item\t6. | Selected\tFinancial\tData | 30 |
| Item\t7. | Management's\tDiscussion\tand\tAnalysis\tof\tFinancial\tCondition\tand\tResults\tof\tOperations | 33 |
| Item\t7A. | Quantitative\tand\tQualitative\tDisclosures\tAbout\tMarket\tRisk | 55 |
| Item\t8. | Financial\tStatements\tand\tSupplementary\tData | 58 |
| Item\t9. | Changes\tin\tand\tDisagreements\twith\tAccountants\ton\tAccounting\tand\tFinancial\tDisclosure | 138 |
| Item\t9A. | Controls\tand\tProcedures | 138 |
| Item\t9B. | Other\tInformation | 139 |
|  | PART\tIII |  |
| Item\t10. | Directors,\tExecutive\tOfficers\tand\tCorporate\tGovernance | 140 |
| Item\t11. | Executive\tCompensation | 141 |
| Item\t12. | Security\tOwnership\tof\tCertain\tBeneficial\tOwners\tand\tManagement\tand\tRelated\tStockholder\tMatters | 141 |
| Item\t13. | Certain\tRelationships\tand\tRelated\tTransactions,\tand\tDirector\tIndependence | 141 |
| Item\t14. | Principal\tAccounting\tFees\tand\tServices | 141 |
|  | PART\tIV |  |
| Item\t15. | Exhibits\tand\tFinancial\tStatement\tSchedules | 142 |
| Item\t16. | Form\t10-K\tSummary | 142 |

# PART	I

# Item	1. BUSINESS

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	 for	 periods	 on	 or	 after	 November	 2,	 2018	 and	 to	 WRKCo	 (formerly	 known	 as WestRock	Company)	for	periods	prior	to	November	2,	2018.

# General

WestRock	 is	 a	 multinational	 provider	 of	 paper	 and	 packaging	 solutions	 for	 consumer	 and	 corrugated	 packaging	 markets.	 We	 partner	 with	 our customers	to	provide	differentiated	paper	and	packaging	solutions	that	help	them	win	in	the	marketplace.	Our	team	members	support	customers	around	the world	from	our	operating	and	business	locations	in	North	America,	South	America,	Europe,	Asia	and	Australia.	We	also	sell	real	estate	primarily	in	the Charleston,	SC	region.

WestRock	was	formed	on	March	6,	2015	for	the	purpose	of	effecting	the	Combination	(as	defined	below).		Pursuant	to	the	second	amended	and restated	business	combination	agreement,	dated	April	17,	2015	and	amended	as	of	May	5,	2015	by	and	among	WestRock,	WestRock	RKT	Company (formerly	 known	 as	 Rock-Tenn	 Company,	 and	 a	 wholly-owned	 subsidiary	 of	 WestRock)	 (" RockTenn"),	 WestRock	 MWV,	 LLC	 (formerly	 known	 as MeadWestvaco	Corporation,	and	a	wholly-owned	subsidiary	of	WestRock)	("MWV"),	Rome	Merger	Sub,	Inc.	and	Milan	Merger	Sub,	LLC	(the	" Business Combination	Agreement"),	on	July	1,	2015,	(i)	Rome	Merger	Sub,	Inc.	merged	with	and	into	RockTenn,	with	RockTenn	surviving	the	merger	as	a	wholly- owned	subsidiary	of	WestRock,	and	(ii)	Milan	Merger	Sub,	LLC	merged	with	and	into	MWV,	with	MWV	surviving	the	merger	as	a	wholly	owned	subsidiary	of WestRock	(the	"Combination").	Prior	to	the	Combination,	WestRock	did	not	conduct	any	activities	other	than	those	incidental	to	its	formation	and	the matters	contemplated	by	the	Business	Combination	Agreement.	On	July	1,	2015,	pursuant	to	the	Business	Combination	Agreement,	RockTenn	and	MWV completed	 a	 strategic	 combination	 of	 their	 respective	 businesses	 and	 RockTenn	 and	 MWV	 each	 became	 wholly-owned	 subsidiaries	 of	 WestRock. RockTenn	was	the	accounting	acquirer	in	the	Combination.	See	"Note	2.	Mergers,	Acquisitions	and	Investment "	of	the	Notes	to	Consolidated	Financial Statements	for	additional	information.

On	May	15,	2016,	WestRock	completed	the	distribution	of	the	outstanding	common	stock,	par	value	$0.01	per	share,	of	Ingevity	Corporation,	formerly the	Specialty	Chemicals	business	of	WestRock	("Ingevity")	to	WestRock's	stockholders	(the	" Separation").	As	a	result	of	the	Separation,	we	disposed	of our	former	Specialty	Chemicals	segment	in	its	entirety	and	ceased	to	consolidate	its	assets,	liabilities	and	results	of	operations	in	our	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	consolidated	financial	statements	for	all	periods	presented.	See	"Note	7.	Discontinued	Operations"	of	 the	Notes	 to Consolidated	Financial	Statements	for	additional	information.

On	April	6,	2017,	we	completed	the	sale	(the	" HH&B	Sale")	of	our	Home,	Health	and	Beauty	business,	a	former	division	of	our	Consumer	Packaging segment	("HH&B").	We	used	the	proceeds	from	the	HH&B	Sale	in	connection	with	the	MPS	Acquisition	(as	defined	below).	We	recorded	a	pre-tax	gain	on sale	of	HH&B	of	$192.8	million	in	fiscal	2017.	See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies	—	Description of	Business"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

On	June	6,	2017,	we	completed	the	acquisition	(the	"MPS	Acquisition")	of	Multi	Packaging	Solutions	International	Limited,	a	Bermuda	(" MPS") exempted	company.	MPS	 is	reported	 in	our	Consumer	Packaging	segment.	See	"Note	2.	Mergers,	Acquisitions	and Investment "	 of	 the	 Notes	 to Consolidated	Financial	Statements	for	additional	information.

We	report	our	financial	results	of	operations	in	the	following	three	reportable	segments:	Corrugated	Packaging,	which	consists	of	our	containerboard mills	and	corrugated	packaging	operations,	as	well	as	our	recycling	operations;	Consumer	Packaging,	which	consists	of	consumer	mills,	folding	carton, beverage,	merchandising	displays	and	partition	operations;	and	Land	and	Development,	which	sells	real	estate	primarily	in	the	Charleston,	SC	region. Following	 the	 Combination	 and	 until	 the	 completion	 of	 the	 Separation,	 our	 financial	 results	 of	 operations	 had	 a	 fourth	 reportable	 segment,	 Specialty Chemicals.	Prior	to	the	HH&B	Sale,	our	Consumer	Packaging	segment	included	HH&B.

# Products

# Corrugated	Packaging	Segment

We	are	one	of	 the	 largest	 integrated	producers	of	 linerboard	and	corrugating	medium	(" containerboard") in	North	America	measured	by	 tons produced,	and	one	of	the	largest	producers	of	high-graphics	preprinted	linerboard	measured	by	net	sales	in	North	America.	We	have	integrated	corrugated operations	in	North	America,	Brazil	and	India.	We	believe	we	are	one	of	the	largest	paper	recyclers	in	North	America	and	our	recycling	operations	provide substantially	all	of	the	recycled	fiber	to	our	mills,	as	well	as	to	third	parties.	Our	Brazil	operations	own	and	operate	forestlands	that	provide	virgin	fiber	to	our Brazilian	mill.

We	operate	an	integrated	corrugated	packaging	system	that	manufactures	primarily	containerboard,	corrugated	sheets,	corrugated	packaging	and preprinted	linerboard	for	sale	to	consumer	and	industrial	products	manufacturers	and	corrugated	box	manufacturers.	We	produce	a	full	range	of	high-quality corrugated	containers	designed	to	protect,	ship,	store,	promote	and	display	products	made	to	our	customers'	merchandising	and	distribution	specifications. We	convert	corrugated	sheets	into	corrugated	products	ranging	from	one-color	protective	cartons	to	graphically	brilliant	point-of-purchase	packaging.	Our corrugated	container	plants	serve	local	customers	and	regional	and	large	national	accounts.	Corrugated	packaging	is	used	to	provide	protective	packaging for	shipment	and	distribution	of	food,	paper,	health	and	beauty,	and	other	household,	consumer,	commercial	and	industrial	products.	Corrugated	packaging may	also	be	graphically	enhanced	for	retail	sale,	particularly	in	club	store	locations.	We	provide	customers	with	innovative	packaging	solutions	to	promote and	 sell	 their	 products.	 We	 provide	 structural	 and	 graphic	 design,	 engineering	 services	 and	 custom,	 proprietary	 and	 standard	 automated	 packaging machines,	 offering	 customers	 turn-key	 installation,	 automation,	 line	 integration	 and	 packaging	 solutions.	 To	 make	 corrugated	 sheet	 stock,	 we	 feed linerboard	and	corrugating	medium	into	a	corrugator	that	flutes	the	medium	to	specified	sizes,	glues	the	linerboard	and	fluted	medium	together,	and	slits and	cuts	the	resulting	corrugated	paperboard	into	sheets	to	customer	specifications.	Our	containerboard	mills	and	corrugated	container	operations	are integrated	with	the	majority	of	our	containerboard	production	used	internally	by	our	corrugated	container	operations.	The	balance	is	either	used	in	trade swaps	with	other	manufacturers	or	sold	domestically	and	internationally.

Our	recycling	operations	primarily	procure	recovered	paper	(also	known	as	recycled	fiber)	from	our	converting	facilities	and	from	third	parties,	such	as factories,	warehouses,	commercial	printers,	office	complexes,	grocery	and	retail	stores,	document	storage	facilities,	paper	converters	and	other	wastepaper collectors.	We	handle	a	wide	variety	of	grades	of	recovered	paper,	including	old	corrugated	containers,	office	paper,	box	clippings,	newspaper	and	print shop	scraps.	We	operate	recycling	facilities	that	collect,	sort,	grade	and	bale	recovered	paper	and,	after	sorting	and	baling,	we	transfer	it	to	our	mills	for processing	or	sell	it	principally	to	manufacturers	of	paperboard	or	containerboard	in	the	United	States	("U.S."),	as	well	as	manufacturers	of	tissue,	newsprint, roofing	products	and	insulation,	and	to	export	markets.	We	operate	a	nationwide	fiber	marketing	and	brokerage	system	that	serves	large	regional	and national	accounts,	as	well	as	our	recycled	containerboard	and	paperboard	mills,	and	sells	scrap	materials	 from	our	converting	businesses	and	mills. Brokerage	contracts	provide	bulk	purchasing,	often	resulting	in	lower	prices	and	cleaner	recovered	paper.	Many	of	our	recycling	facilities	are	located	close	to our	recycled	containerboard	and	paperboard	mills,	which	helps	promote	the	availability	of	supply	with	reduced	shipping	costs.	In	fiscal	2019,	we	plan	to operate	our	recycling	operations	primarily	as	a	procurement	function,	shifting	its	focus	to	the	procurement	of	low	cost,	high	quality	fiber	for	our	mill	system. As	a	result,	we	will	no	longer	record	recycling	sales.	Sales	of	corrugated	packaging	products	to	external	customers	accounted	for	54.9%,	55.5%	and	54.6% of	our	net	sales	in	fiscal	2018,	2017	and	2016,	respectively.	See	"Note	6.	Segment	Information"	of	the	Notes	to	Consolidated	Financial	Statements,	as	well as	Item	7.	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations ",	for	additional	information.

# Consumer	Packaging	Segment

We	operate	integrated	virgin	and	recycled	fiber	paperboard	mills,	consumer	packaging	converting	operations,	which	convert	items	such	as	folding	and beverage	cartons,	displays,	interior	partitions,	inserts	and	labels.	Our	integrated	system	of	virgin	and	recycled	mills	produces	paperboard	for	our	converting operations	and	third	parties.	We	internally	consume	or	sell	to	manufacturers	of	folding	cartons	and	other	paperboard	products	our	coated	natural	kraft, bleached	paperboard	and	coated	recycled	paperboard,	and	internally	consume	or	sell	to	manufacturers	of	solid	fiber	interior	packaging,	tubes	and	cores, book	covers	and	other	paperboard	products	our	specialty	recycled	paperboard.	The	mill	owned	by	our	Seven	Hills	Paperboard	LLC	("Seven	Hills")	joint venture	in	Lynchburg,	VA	manufactures	gypsum	paperboard	liner	for	sale	to	our	joint	venture	partner.

We	are	one	of	the	largest	manufacturers	of	folding	and	beverage	cartons	in	North	America.	We	believe	we	are	one	of	the	largest	manufacturers	of temporary	promotional	point-of-purchase	displays	in	North	America	measured	by	net	sales	and	the	largest	manufacturer	of	solid	fiber	partitions	in	North America	measured	by	net	sales.	Our	folding	and	beverage	cartons	are	used	to	package	items	such	as	food,	paper,	beverages,	dairy	products,	tobacco, confectionery,	health	and	beauty	and	other	household	consumer,	commercial	and	industrial	products	primarily	for	retail	sale.	Our	folding	and	beverage cartons	are	also	used	by	our	customers	to	attract	consumer	attention	at	the	point-of-sale.	We	manufacture	express	mail	packages	for	the	overnight	courier industry,	provide	inserts	and	labels	as	well	as	rigid	packaging	and	other	printed	packaging	products,	such	as	transaction	cards	(e.g.,	credit,	debit,	etc.), brochures,	product	literature,	marketing	materials	(such	as	booklets,	folders,	inserts,	cover	sheets	and	slipcases)	and	grower	tags	and	plant	stakes	for	the horticultural	market.	For	the	global	healthcare	market,	we	manufacture	secondary	packages	designed	to	enhance	patient	adherence	for	prescription	drugs, as	well	as	paperboard	packaging	for	over-the-counter	and	prescription	drugs.	Our	customers	generally	use	our	inserts	and	labels	to	provide	customer product	information	either	inside	a	secondary	package	(e.g.,	a	folding	carton)	or	affixed	to	the	outside	of	a	primary	package	(e.g.,	a	bottle).	Folding	cartons typically	protect	customers'	products	during	shipment	and	distribution,	and	employ	graphics	to	promote	them	at	retail.	We	manufacture	folding	and	beverage cartons	from	recycled	and	virgin	paperboard,	laminated	paperboard	and	various	substrates	with	specialty	characteristics,	such	as	grease	masking	and microwaveability.	We	print,	coat,	die-cut	and	glue	the	cartons	to	customer	specifications	and	ship	finished	cartons	to	customers	for	assembling,	filling	and sealing.	We	employ	a	broad	range	of	offset,	flexographic,	gravure,	backside	printing,	coating	and	finishing	technologies,	as	well	as	iridescent,	holographic, textured	and	dimensional	effects	to	provide	differentiated	packaging	products,	and	support	our	customers	with	new	package	development,	innovation	and design	services	and	package	testing	services.	We	manufacture	and	sell	our	solid	fiber	and	corrugated	partitions	and	die-cut	paperboard	components principally	to	glass	container	manufacturers	and	producers	of	beer,	food,	wine,	spirits,	cosmetics	and	pharmaceuticals,	and	to	the	automotive	industry.

We	design,	manufacture	and,	in	certain	cases,	pack	temporary	displays	for	sale	to	consumer	products	companies	and	retailers.	These	displays	are used	as	marketing	tools	to	support	new	product	introductions	and	specific	product	promotions	in	mass	merchandising	stores,	supermarkets,	convenience stores,	home	improvement	stores	and	other	retail	locations.	We	also	design,	manufacture	and,	in	some	cases,	pre-assemble	permanent	displays	for	these customers.	We	make	temporary	displays	primarily	from	corrugated	paperboard.	Unlike	temporary	displays,	permanent	displays	are	restocked	with	our customers'	product;	therefore,	they	are	constructed	primarily	from	metal,	plastic,	wood	and	other	durable	materials.	We	provide	contract	packing	services, such	as	multi-product	promotional	packing	and	product	manipulation,	such	as	multipacks	and	onpacks.	We	manufacture	and	distribute	point	of	sale	material utilizing	litho,	screen	and	digital	printing	technologies.	We	manufacture	lithographic	laminated	packaging	for	sale	to	our	customers	that	require	packaging with	high	quality	graphics	and	strength	characteristics.

Sales	of	consumer	packaging	products	to	external	customers	accounted	for	44.2%,	42.8%	and	44.6%	of	our	net	sales	in	fiscal	2018,	2017	and	2016, respectively.	See	"Note	6.	Segment	Information"	of	the	Notes	to	Consolidated	Financial	Statements,	as	well	as	Item	7.	" Management's	Discussion	and Analysis	of	Financial	Condition	and	Results	of	Operations",	for	additional	information.

# Land	and	Development	Segment

We	are	responsible	for	maximizing	the	value	of	the	various	real	estate	holdings	we	own	that	are	concentrated	in	the	Charleston,	SC	region,	some	of which	 are	 held	 through	 partnerships.	 We	 are	 in	 the	 process	 of	 accelerating	 the	 monetization	 of	 these	 holdings	 and	 expect	 to	 complete	 the monetization	during	fiscal	2019.	After	we	complete	the	monetization,	the	segment	will	cease	to	exist.	Sales	in	our	Land	and	Development	segment	to external	customers	accounted	for	0.9%,	1.7%	and	0.8%	of	our	net	sales	in	fiscal	2018,	2017	and	2016,	respectively.	See	"Note	6.	Segment	Information" and	"Note	9.	Assets	Held	For	Sale "	of	the	Notes	to	Consolidated	Financial	Statements,	as	well	as	Item	7.	" Management's	Discussion	and	Analysis	of Financial	Condition	and	Results	of	Operations",	for	additional	information.

# Raw	Materials

The	primary	raw	materials	used	by	our	mill	operations	are	recycled	fiber	at	our	recycled	containerboard	and	paperboard	mills	and	virgin	fibers	from hardwoods	and	softwoods	at	our	virgin	containerboard	and	paperboard	mills.	Certain	of	our	virgin	containerboard	is	manufactured	with	some	recycled	fiber content.	Recycled	fiber	prices	and	virgin	fiber	prices	can	fluctuate	significantly.	While	virgin	fiber	prices	have	generally	been	more	stable	than	recycled	fiber prices,	they	also	fluctuate,	particularly	during	significant	changes	in	weather,	such	as	during	prolonged	periods	of	heavy	rain	or	drought,	or	during	housing construction	slowdowns	or	accelerations.

Containerboard	and	paperboard	are	the	primary	raw	materials	used	by	our	converting	operations.	Our	converting	operations	use	many	different grades	of	containerboard	and	paperboard.	We	supply	substantially	all	of	our	converting	operations'	needs	for	containerboard	and	paperboard	from	our	own mills	and	through	the	use	of	trade	swaps	with	other	manufacturers.	These	arrangements	allow	us	to	optimize	our	mill	system	and	reduce	freight	costs. Because	there	are	other	suppliers	that	produce	the	necessary	grades	of	containerboard	and	paperboard	used	in	our	converting	operations,	we	believe	we would	 be	 able	 to	 source	 significant	 replacement	 quantities	 from	 other	 suppliers	 in	 the	 event	 we	 incur	 production	 disruptions	 for	 recycled	 or	 virgin containerboard	and	paperboard.	See	Item	1A.	"Risk	Factors	—	We	May	Face	Increased	Costs	or	Inadequate	Availability	of	Raw	Materials,	Energy and	Transportation".

# Energy

Energy	is	one	of	the	most	significant	costs	of	our	mill	operations.	The	cost	of	natural	gas,	coal,	oil,	electricity	and	wood	by-products	(biomass)	at	times has	fluctuated	significantly.	In	our	recycled	paperboard	mills,	we	use	primarily	natural	gas	and	electricity,	supplemented	with	coal	and	fuel	oil	to	generate steam	used	in	the	paper	making	process	and,	at	a	few	mills,	to	generate	electricity	used	on	site.	In	our	virgin	fiber	mills,	we	use	natural	gas,	biomass	and coal	to	generate	steam	used	in	the	pulping	and	paper	making	processes	and	to	generate	some	or	all	of	the	electricity	used	on	site.	We	primarily	use electricity	and	natural	gas	to	operate	our	converting	facilities.	We	generally	purchase	these	products	from	suppliers	at	market	or	tariff	rates.	See	Item	1. "Business	—	Governmental	Regulation	—	Environmental	and	Other	Matters "	for	additional	information.	See	also	Item	1A. "Risk	Factors	—	We	May Face	Increased	Costs	or	Inadequate	Availability	of	Raw	Materials,	Energy	and	Transportation".

# Transportation

Inbound	and	outbound	freight	is	a	significant	expenditure	for	us.	Factors	that	influence	our	freight	expense	are	distance	between	our	shipping	and delivery	locations,	distance	from	our	facilities	to	our	customers	and	suppliers,	mode	of	transportation	(rail,	truck,	intermodal	and	ocean)	and	freight	rates, which	are	influenced	by	supply	and	demand	and	fuel	costs.	We	experienced	significantly	higher	freight	costs	in	fiscal	2018,	as	transportation	companies raised	prices	to	address	a	shortage	of	drivers	and	strong	demand.	The	principal	markets	for	our	products	are	in	North	America,	South	America,	Europe, Asia	 and	 Australia.	 See Item	 1A.	"Risk	 Factors	 —	 We	 May	 Face Increased	 Costs	 or Inadequate	 Availability	 of	 Raw	 Materials,	 Energy	 and Transportation".

# Sales	and	Marketing

None	 of	 our	 top	 ten	 external	 customers	 individually	 accounted	 for	 more	 than	 10%	 of	 our	 consolidated	 net	 sales	 in	 fiscal	 2018.	 We	 generally manufacture	our	products	pursuant	to	customers'	orders.	We	believe	that	we	have	good	relationships	with	our	customers.	See	Item	1A.	"Risk	Factors	—

# We	Depend	on	Certain	Large	Customers".

As	a	result	of	our	vertical	integration,	our	mills'	sales	volumes	may	be	directly	impacted	by	changes	in	demand	for	our	packaging	products.	During fiscal	2018,	approximately	two-thirds	of	our	coated	natural	kraft	tons	shipped,	approximately	three-fifths	of	our	coated	recycled	paperboard	tons	shipped	and approximately	one-fifth	of	our	bleached	paperboard	tons	shipped	were	delivered	to	our	converting	operations,	primarily	to	manufacture	folding	and	beverage cartons,	 and	 approximately	 three-fourths	 of	 our	 containerboard	 tons	 shipped,	 including	 trade	 swaps	 and	 buy/sell	 transactions,	 were	 delivered	 to	 our converting	operations	 to	manufacture	corrugated	products.	Under	 the	 terms	of	our	Seven	Hills	 joint	venture	arrangement,	our	 joint	venture	partner	 is required	to	purchase	all	of	the	qualifying	gypsum	paperboard	liner	produced	by	Seven	Hills.	Excluding	the	production	from	Seven	Hills	and	from	our	Aurora, IL	facility,	which	is	converted	into	book	covers	and	other	products,	approximately	two-fifths	of	our	specialty	recycled	paperboard	tons	shipped	in	fiscal	2018 were	delivered	to	our	converting	operations,	primarily	to	manufacture	interior	partitions.	We	have	the	ability	to	move	our	internal	sourcing	among	certain	of our	mills	to	optimize	the	efficiency	of	our	operations.

We	aim	to	execute	consistent	commercial	excellence	processes	across	the	Company	and	believe	that	our	ability	to	leverage	our	full	portfolio	of differentiated	solutions	and	capabilities	enables	us	to	differentiate	ourselves	from	our	competitors.

We	market	our	products	primarily	through	our	own	sales	force.	We	also	market	a	number	of	our	products	through	independent	sales	representatives, independent	 distributors	 or	 both.	 We	 generally	 pay	 our	 sales	 personnel	 a	 combination	 of	 base	 salary,	 commissions	 and	 annual	 bonus.	 We	 pay	 our independent	sales	representatives	on	a	commission	basis.	We	discuss	foreign	net	sales	to	unaffiliated	customers	and	other	non-U.S.	operations	financial and	other	segment	information	in	"Note	6.	Segment	Information"	of	the	Notes	to	Consolidated	Financial	Statements.

# Competition

We	operate	in	a	competitive	global	marketplace	and	compete	with	many	large,	well	established	and	highly	competitive	manufacturers	and	service providers.	Our	business	is	affected	by	a	range	of	macroeconomic	conditions,	including	industry	capacity	changes,	global	competition,	economic	conditions in	the	U.S.	and	abroad,	as	well	as	fluctuations	in	currency	exchange	rates.

The	industries	we	operate	in	are	highly	competitive,	and	no	single	company	dominates	any	of	those	industries.	Our	containerboard	and	paperboard operations	compete	with	integrated	and	non-integrated	national	and	regional	companies	operating	primarily	in	North	America,	and	to	a	limited	extent, manufacturers	outside	of	North	America.	Our	competitors	include	large	and	small,	vertically	integrated	companies	and	numerous	smaller	non-integrated companies.	In	the	corrugated	packaging	and	folding	and	beverage	carton	markets,	we	compete	with	a	significant	number	of	national,	regional	and	local packaging	suppliers	in	North	America	and	abroad.	In	the	solid	fiber	interior	packaging,	promotional	point-of-purchase	display	and	converted	paperboard products	markets,	we	primarily	compete	with	a	smaller	number	of	national,	regional	and	local	companies	offering	highly	specialized	products.	Our	recycled fiber	brokerage	and	collection	operations	compete	with	various	other	companies	for	the	procurement	and	supply	of	recovered	paper,	including	brokers	and companies	that	export	recovered	paper	to	international	markets.	The	Land	and	Development	segment	competes	in	the	real	estate	sales	and	development market,	primarily	in	the	Charleston,	SC	region.

Because	all	of	our	businesses	operate	in	highly	competitive	industry	segments,	we	regularly	discuss	sales	opportunities	for	new	business	or	for renewal	of	existing	business	with	customers.	Our	packaging	products	compete	with	packaging	made	from	other	materials,	including	plastics.	The	primary competitive	factors	we	face	include	price,	design,	product	innovation,	quality	and	service,	with	varying	emphasis	on	these	factors	depending	on	the	product line	and	customer	preferences.	We	believe	that	we	compete	effectively	with	respect	to	each	of	these	factors	and	we	obtain	feedback	on	our	performance with	customer	surveys,	among	other	means.

The	businesses	we	operate	in	have	undergone	consolidation.	Within	the	packaging	products	industry,	larger	customers,	with	an	expanded	geographic presence,	have	tended	to	seek	suppliers	that	can,	because	of	their	broad	geographic	presence,	efficiently	and	economically	supply	all	or	a	range	of	their packaging	needs.	In	addition,	our	customers	continue	to	demand	higher	quality	products	meeting	stricter	quality	control	requirements.

See Item	 1A.	"Risk	Factors	—	We	Face	Intense	Competition"	 and	"Risk	Factors	—	We	May	Be	Adversely	Affected	by	Factors	That	Are Beyond	Our	Control,	Such	as	U.S.	and	Worldwide	Economic	and	Financial	Market	Conditions,	and	Social	and	Political	Change".

# Governmental	Regulation

# Health	and	Safety	Regulations

Our	operations	are	subject	to	federal,	state,	local	and	foreign	laws	and	regulations	relating	to	workplace	safety	and	worker	health,	including	the Occupational	Safety	and	Health	Act	of	1970	("OSHA")	and	similar	laws	and	regulations.	OSHA,	among	other	things,	establishes	asbestos	standards	for	the workplace.	Although	we	do	not	use	asbestos	in	manufacturing	our	products,	asbestos	containing	material	("ACM")	is	present	in	some	of	our	facilities.	For those	facilities	where	ACM	is	present,	we	have	established	procedures	for	properly	managing	the	material,	including,	but	not	limited	to,	employee	training and	work	practices	to	maintain	the	ACM	in	good	condition	and	minimize	exposure.	We	do	not	believe	that	future	compliance	with	health	and	safety	laws and	regulations	will	have	a	material	adverse	effect	on	our	results	of	operations,	financial	condition	or	cash	flows.

# Environmental	and	Other	Matters

Environmental	compliance	requirements	are	a	significant	factor	affecting	our	business.	We	employ	manufacturing	processes	that	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	U.S.	Environmental	Protection	Agency	("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."	Boiler	MACT	required	compliance	by	January	31,	2016	or	by	January	31,	2017	for	those	mills	for	which	we	obtained	a	prior	compliance	extension. All

work	required	for	our	boilers	to	comply	with	the	rule	has	been	completed.	On	July	29,	2016,	the	U.S.	Court	of	Appeals	for	the	District	of	Columbia	Circuit 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	this 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	are	involved	in	various	administrative	proceedings	relating	to	environmental	matters	that	arise	in	the	normal	course	of	business,	and	we	may become	involved	in	similar	matters	in	the	future.	Although	the	ultimate	outcome	of	these	proceedings	cannot	be	predicted	with	certainty	and	we	cannot	at this	 time	 estimate	 any	 reasonably	 possible	 losses	 based	 on	 available	 information,	 we	 do	 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.

# See	Item	1A.	"Risk	Factors	—	We	are	Subject	to	a	Wide	Variety	of	Laws,	Regulations	and	Other	Requirements	That	are	Subject	to	Change and	May	Impose	Substantial	Compliance	Costs".

# 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	the	Comprehensive	Environmental	Response, Compensation,	and	Liability	Act	of	1980	("CERCLA")	and	analogous	laws.	While	joint	and	several	liability	is	authorized	under	CERCLA,	liability	is	typically shared	with	other	potentially	responsible	parties	("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,	including	CERCLA. Based	on	information	known	to	us	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,	including	natural	resources damaged	at	these	or	other	sites	in	the	future	could	result	in	additional	costs.

On	January	26,	2009,	Smurfit-Stone	Container	Corporation	("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	satisfied	by	claims	in	the	Smurfit- Stone	bankruptcy	proceedings.	However,	we	may	face	additional	liability	for	cleanup	activity	at	sites	that	are	not	subject	to	the	bankruptcy	discharge,	but	are not	currently	identified.	The	final	bankruptcy	distributions	were	made	in	fiscal	2018.

We	believe	that	we	can	assert	claims	for	indemnification	pursuant	to	existing	rights	we	have	under	purchase	and	other	agreements	in	connection	with certain	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	remediation	projects	at	other	locations,	and	it is	possible	that	our	remediation	requirements	and	costs	could	increase	materially	in	the	future	and	exceed	current	reserves.	In	addition,	we	cannot	currently 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	results	of	operations,	financial	condition	or	cash	flows.

We	 estimate	 that	 we	 will	 invest	 approximately	 $22	 million	 for	 capital	 expenditures	 during	 fiscal	 2019	 in	 connection	 with	 matters	 relating	 to environmental	compliance,	excluding	KapStone.	It	is	possible	that	our	capital	expenditure	assumptions	and	the	project	completion	dates	may	change,	and our	projections	are	subject	to	change	due	to	items	such	as	the	finalization	of	ongoing	engineering	projects	and	the	outcomes	of	pending	legal	challenges	to the	Boiler	MACT	rules.

# Climate	Change

Certain	jurisdictions	in	which	we	have	manufacturing	facilities	or	other	investments	have	taken	actions	to	address	climate	change.	The	EPA	has issued	the	Clean	Air	Act	permitting	regulations	applicable	to	certain	facilities	that	emit	greenhouse	gases	("GHG").	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	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.	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. As	directed	by	Executive	Order	by	the	President	of	the	United	States	("Executive	Order"),	on	April	4,	2017,	the	EPA	issued	a	proposed	rule	announcing	its intention	to	review	the	Clean	Power	Plan,	and,	if	appropriate,	initiate	proceedings	to	suspend,	revise	or	rescind	it.	A	number	of	states	subject	to	the	Clean Power	Plan	have	stopped	working	on	their	implementation	strategies	in	response	to	the	litigation	and	Executive	Order;	however,	certain	states	where	we operate	 manufacturing	 facilities	 have	 indicated	 their	 intention	 to	 continue	 their	 carbon	 reduction	 efforts.	On	August	 21,	 2018,	 the	 EPA	 proposed	 the Affordable	Clean	Energy	("ACE")	rule,	which	would	establish	emission	guidelines	for	states	to	develop	plans	to	address	greenhouse	gas	emissions	from existing	coal-fired	power	plants.	The	ACE	rule	would	replace	the	2015	Clean	Power	Plan,	which	EPA	has 	 proposed	to	repeal.	The	Clean	Power	Plan	was stayed	by	the	U.S.	Supreme	Court	and	has	never	gone	into	effect.	Although	the	Clean	Power	Plan	and	ACE	rule	do	not	apply	directly	to	the	power generation	 facilities	 at	 our	 mills,	 if	 either	 rule	 becomes	 effective,	 it	 would	 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.	Due	to	ongoing	litigation	and other	uncertainties	regarding	the	Clean	Power	Plan	and	ACE	rule,	their	potential	impacts	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	developing	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.	In	July	2017,	California	extended the	cap-and-trade	program	to	2030.	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	issued	a	final	rule,	known	as	the	Clean	Air	Rule,	which	applies	to	facilities	that	have	average	annual	carbon	dioxide	equivalent emissions	equal	to	or	exceeding	100,000	metric	tons/year.	Energy	intensive	and	trade	exposed	facilities,	including	our	Tacoma,	WA	and	Longview,	WA (which	we	acquired	through	the	KapStone	Acquisition	(as	hereinafter	defined))	mills,	and	transportation	fuel	importers	are	subject	to	regulation	under	this program.	In	September	2016,	various	groups	filed	lawsuits	against	the	Washington	Department	of	Ecology	challenging	the	Clean	Air	Rule.	In	April	2018,	the Thurston	County	Superior	Court	invalidated	the	Clean	Air	Rule,	and	the	Washington	Department	of	Ecology	subsequently	filed	an	appeal	with	the	State Supreme	Court.	The	Court	has	not	yet	decided	whether	to	grant	the	appeal.	Implementation	of	the	Clean	Air	Rule	has	been	stayed	in	the	meantime.

The	agreement	signed	in	April	2016	among	the	U.S.	and	over	170	other	countries,	which	arose	out	of	negotiations	at	the	United	Nation's	Conference of	Parties	(COP21)	climate	summit	in	December	2015	(the	"Paris	Agreement"),	established	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	GHG	reduction	targets.	The	Paris	Agreement became	effective	on	November	4,	2016.	Although	a	party	to	the	agreement	may	not	provide	the	required	one-year	notice	of	withdrawal	until	three	years after	the	effective	date,	in	June	2017,	President	Trump	announced	that	the	U.S.	intended	to	withdraw	from	the	Paris	Agreement.	The

governors	of	New	York,	California	and	Washington	subsequently	announced	their	intent	to	form	a	"climate	alliance"	to	coordinate	a	state	response	to climate	change.	At	 this	 time,	 it	 is	not	possible	 to	determine	how	 the	Paris	Agreement,	or	any	potential	U.S.	commitments	 in	 lieu	of	 those	under	 the agreement,	may	impact	U.S.	industrial	facilities,	including	our	domestic	operations.

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	and	37.5%	from	1990	levels	by	2030.	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.	The	Province	formally	linked	its	carbon	trading	system	with	California's	system	in	January 2014	and	with	Ontario's	system	in	January	2018.	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.

# Sustainability

Sustainability	is	an	integral	part	of	our	business	strategy	and	one	of	our	four	stated	key	value	drivers	for	our	customers.	Paper-based	packaging	has several	attributes	that,	we	believe,	makes	it	well-suited	to	helping	our	customers	provide	sustainable	solutions	for	 their	customers.	For	example,	 it	 is lightweight,	 durable,	 versatile,	 renewable	 and	 recyclable.	 Given	 the	 size	 and	 geographic	 breadth	 of	 our	 manufacturing	 operations	 and	 our	 history	 of developing	innovative	products	and	solutions,	we	believe	that	we	are	uniquely	positioned	to	help	our	customers	improve	their	sustainability.	Also,	we	are helping	to	drive	the	development	of	the	circular	economy	by	recovering	used	paper-based	packaging	through	our	extensive	network	of	recycling	facilities and	turning	the	recovered	fiber	into	new	packaging	or	selling	it	to	others	to	use	to	make	new	products.	Examples	of	our	commitment	to	sustainability	include having	one	of	the	industry's	largest	certified	virgin	fiber	procurement	systems	and	heading	an	industry-leading	foodservice	recycling	initiative.	We	have	been recognized	for	our	sustainability	efforts	through,	among	other	things,	industry	award	programs	and	inclusion	in	the	FTSE	4	Good	index.

# Patents	and	Other	Intellectual	Property

We	hold	a	substantial	number	of	foreign	and	domestic	trademarks,	trademark	applications,	trade	names,	patents,	patent	applications	and	licenses relating	to	our	business,	our	products	and	our	production	processes.	Our	patent	portfolio	consists	primarily	of	utility	and	design	patents	relating	to	our products	and	manufacturing	operations.	It	also	includes	exclusive	rights	to	substantial	proprietary	packaging	system	technology	in	the	U.S.	or	other	licenses obtained	from	a	third	party.	Our	brand	name	and	logo,	and	certain	of	our	products	and	services,	are	protected	by	domestic	and	foreign	trademark	rights.	Our patents,	trademarks	and	other	intellectual	property	rights,	particularly	those	relating	to	our	converting	operations,	are	important	to	our	operations	as	a	whole. Our	 intellectual	 property	 has	 various	 expiration	 dates.	 See	 Item	 1A.	"Risk	 Factors	 —	 We	 Depend	 On	 Our	Ability to	 Develop	 and	 Successfully Introduce	New	Products	and/or	to	Acquire	and	Retain	Intellectual	Property	Rights".

# Employees

At	September	30,	2018,	we	employed	approximately	45,100	people,	of	which	approximately	76%	were	located	in	the	U.S.	and	Canada	and	24%	were located	in	Europe,	South	America,	Mexico	and	Asia/Pacific.	Of	the	approximately	45,100	employees,	approximately	71%	were	hourly,	and	approximately 29%	were	salaried,	employees.	Approximately	41%	of	our	hourly	employees	in	the	U.S.	and	Canada	are	covered	by	collective	bargaining	agreements ("CBA	 or	CBAs"),	which	typically	have	four	to	six	year	terms.	Approximately	3%	of	our	employees	in	the	U.S.	and	Canada	are	working	under	expired contracts	and	approximately	2%	of	our	U.S.	and	Canada	employees	are	covered	under	CBAs	that	expire	within	one	year.	Approximately	49%	of	our employees	outside	the	U.S.	and	Canada	are	covered	by	agreements	similar	to	CBAs,	which	most	frequently	have	four	to	six	year	terms.	Approximately	5% of	our	employees	not	based	in	the	U.S.	and	Canada	are	working	under	expired	agreements	and	approximately	6%	of	them	are	covered	under	agreements that	expire	within	one	year.

While	we	have	experienced	isolated	work	stoppages	in	the	past,	we	have	been	able	to	resolve	them,	and	we	believe	that	working	relationships	with	our employees	are	generally	good.	While	the	terms	of	our	CBAs	vary,	we	believe	the	material	terms	of	the	agreements	are	customary	for	the	industry,	the	type of	facility,	the	classification	of	the	employees	and	the	geographic	location	covered.

In	October	2014,	we	entered	into	a	master	agreement	with	the	United	Steelworkers	Union	(" USW")	that	applied	to	substantially	all	of	our	legacy RockTenn	facilities	represented	by	the	USW	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,	 substance	 abuse	 testing	 and	 successorship.	 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.	Wage	increases	specified	in the	master	agreement	have	been	negotiated	and	ratified.	The	master	agreement	permits	us	to	apply	its	terms	to	USW	employees	who	work	at	facilities	we acquire	during	the	term	of	the	agreement.	The	master	agreement	covers	approximately	60	of	our	U.S.	facilities	and	approximately	6,800	of	our	employees.

# See	Item	1A.	"Risk	Factors	—	We	May	Be	Adversely	Impacted	By	Work	Stoppages	and	Other	Labor	Relations	Matters ".

# International	Operations

Our	operations	outside	the	U.S.	are	conducted	through	subsidiaries	located	in	Canada,	Mexico,	South	America,	Europe,	Asia	and	Australia.	Sales attributable	to	non-U.S.	operations	were	19.9%,	17.6%	and	17.1%	of	our	net	sales	in	fiscal	2018,	2017	and	2016,	respectively,	some	of	which	were transacted	in	U.S.	dollars.	See	"Note	6.	Segment	Information"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.	See	also	Item 1A.	"Risk	Factors	—	We	are	Exposed	to	Risks	Related	to	International	Sales	and	Operations ".

# Available	Information

Our	Internet	address	is	www.westrock.com.	Our	Internet	address	is	included	herein	as	an	inactive	textual	reference	only.	The	information	contained on	our	website	is	not	incorporated	by	reference	herein	and	should	not	be	considered	part	of	this	report.	We	file	annual,	quarterly	and	current	reports,	proxy statements	and	other	information	with	the	Securities	and	Exchange	Commission	("SEC")	and	we	make	available	free	of	charge	most	of	our	SEC	filings through	our	Internet	website	as	soon	as	reasonably	practicable	after	filing	with	the	SEC.	You	may	access	these	SEC	filings	via	the	hyperlink	that	we	provide on	our	website	 to	a	 third-party	SEC	 filings	website.	We	also	make	available	on	our	website	our	board	committee	charters,	as	well	as	 the	corporate governance	guidelines	adopted	by	our	board	of	directors,	our	Code	of	Conduct	for	employees,	our	Code	of	Conduct	and	Ethics	for	the	Board	of	Directors and	our	Code	of	Ethical	Conduct	for	Chief	Executive	Officer	("CEO")	and	Senior	Financial	Officers.	Any	amendments	to,	or	waiver	from,	any	provision	of these	codes	that	are	required	to	be	disclosed	will	be	posted	on	our	website.	We	will	also	provide	copies	of	these	documents,	without	charge,	at	the	written request	of	any	stockholder	of	record.	Requests	for	copies	should	be	mailed	to:	WestRock	Company,	1000	Abernathy	Road	NE,	Atlanta,	Georgia	30328, Attention:	Corporate	Secretary.

# Forward-Looking	Information

This	report	contains	statements	that	relate	to	future,	rather	than	past,	events.	These	statements	are	forward-looking	statements	within	the	meaning	of the	Private	Securities	Litigation	Reform	Act	of	1995.	The	forward-looking	statements	made	in	this	report	often	address	our	expected	future	business	and financial	performance	and	financial	conditions,	and	often	contain	words	such	as	"may",	"will",	"could",	"would",	"anticipate",	"intend",	"estimate",	"project", "plan",	"believe",	"expect",	"target"	and	"potential",	or	refer	to	future	time	periods.	Forward-looking	statements	are	based	on	currently	available	information and	our	current	expectations,	beliefs,	plans	or	forecasts,	and	include	statements	made	in	this	report	regarding,	among	other	things:

•our	belief	that	we	are	one	of	the	largest	paper	recyclers	in	North	America;

•our	plan	to	operate	our	recycling	operations	primarily	as	a	procurement	function	in	fiscal	2019;

•our	belief	that	we	are	one	of	the	largest	manufacturers	of	temporary	promotional	point-of-purchase	displays	in	North	America	measured	by net	sales	and	the	largest	manufacturer	of	solid	fiber	partitions	in	North	America	measured	by	net	sales;

•our	expectation	that	we	will	complete	the	monetization	of	our	Land	and	Development	holdings	during	fiscal	2019;

•our	 belief	 that	 we	 would	 be	 able	 to	 source	 significant	 replacement	 quantities from	 other	 suppliers in the	 event	 we incur	 production disruptions	for	recycled	or	virgin	containerboard	and	paperboard;

•our	belief	that	we	have	good	relationships	with	our	customers;

•our	belief	that	our	ability	to	leverage	our	full	portfolio	of	differentiated	solutions	and	capabilities	enables	us	to	differentiate	ourselves	from	our competitors;

•our	belief	that	we	compete	effectively	on	price,	design,	product	innovation,	quality	and	service;

•our	belief	that	future	compliance	with	health	and	safety	laws	and	regulations	will	not	have	a	material	adverse	effect	on	our	results	of operations,	financial	condition	or	cash	flows;

•our	belief	that	the	currently	expected	outcome	of	any	environmental	proceedings	and	claims	that	are	pending	or	threatened	against	us	will not	have	a	material	adverse	effect	on	our	results	of	operations,	financial	condition	or	cash	flows;

•our	 belief	 that	 the	 costs	 associated	 with	 investigations	 or	 remediations	 under	 various	 environmental	 laws, including	 CERCLA,	 and regulations	will	not	have	a	material	adverse	effect	on	our	results	of	operations,	financial	condition	or	cash	flows;

•our	belief	that	matters	relating	to	previously	identified	third	party	PRP	sites	and	certain	facilities	formerly	owned	or	operated	by	Smurfit- Stone	have	been	satisfied	by	claims	in	the	Smurfit-Stone	bankruptcy	proceedings;

•our	belief	 that	we	can	assert	claims	 for	 indemnification	pursuant	 to	existing	rights	we	have	under	purchase	and	other	agreements	 in connection	with	certain	of	our	existing	remediation	sites	and	have	insurance	coverage,	subject	to	applicable	deductibles/retentions,	policy limits	and	other	conditions,	for	certain	environmental	matters;

•our	expectation	that	compliance	with	the	Western	Climate	Initiative	and	other	similar	programs	may	require	future	expenditures	to	meet required	GHG	emission	reduction	requirements	in	future	years;

•our	belief	that	we	are	uniquely	positioned	to	help	our	customers	improve	their	sustainability;

•our	belief	that	working	relationships	with	our	employees	are	generally	good	and	that	the	material	terms	of	our	CBAs	are	customary	for	the industry,	the	type	of	facility,	the	classification	of	the	employees	and	the	geographic	location	covered;

•our	belief	that	the	trading	price	of	our	Common	Stock	was	adversely	affected	in	fiscal	2018	due,	in	part,	to	concerns	about	announcements by	certain	of	our	competitors	of	planned	additional	capacity	in	the	North	American	containerboard	market;

•that	we	may	be	required	to	incur	additional	indebtedness	to	satisfy	our	payment	obligations	in	respect	of	our	put	and	call	options	or	other arrangements	pursuant	to	which	we	increase	our	ownership	in	Grupo	Gondi;

•that	we	may	form	additional	joint	ventures;

•our	expectation	that	benefits	from	potential,	as	well	as	completed,	acquisitions	and	joint	ventures	will	include	synergies,	cost	savings, growth	opportunities	or	access	to	new	markets	(or	a	combination	thereof),	and	in	the	case	of	divestitures,	the	realization	of	proceeds	from the	sale	of	businesses	and	assets	to	purchasers	that	place	higher	strategic	value	on	these	businesses	and	assets	than	we	do;

•our	expectation	that	the	KapStone	Acquisition	to	generate	synergies	and	performance	improvements	of	approximately	$200	million	by	the end	of	fiscal	2021;

•our	expectation	that	we	will	continue	to	incur	significant	capital,	operating	and	other	expenditures	complying	with	applicable	environmental laws	 and	 regulations,	 particularly	 those	 related	 to	 air	 and	 water	 quality,	 waste	 disposal	 and	 the	 cleanup	 of	 contaminated	 soil	 and groundwater,	including	situations	where	we	have	been	identified	as	a	PRP;

•our	expectation	that	we	will	make	future	contributions	primarily	to	certain	of	our	non-U.S.	pension	plans	in	the	coming	years;

•our	belief	that	certain	multiemployer	pension	plans	(" MEPP"	or	"MEPPs")	in	which	we	participate	or	have	participated,	including	Pace Industry	Union-Management	Pension	Fund	("PIUMPF"),	have	material	unfunded	vested	benefits;

•that	we	are	considering	withdrawing	from,	and	may	withdraw	from,	one	or	more	MEPPs;

•our	belief	that	our	existing	production	capacity	is	adequate	to	serve	existing	demand	for	our	products	and	that	our	plants	and	equipment	are in	good	condition;

•our	expectation	that	the	linerboard	production	system	of	Panama	City,	FL	mill	will	return	to	full	production	capacity	by	the	end	of	November 2018	and	that	the	market	pulp	production	line	will	operate	at	50%	of	capacity	by	early	December	2018	and	should	return	to	full	operation	in approximately	six	months;

•our	belief	that	the	resolution	of	lawsuits	and	claims	will	not	have	a	material	adverse	effect	on	our	consolidated	financial	condition,	results	of operations	or	cash	flows; •our	 expectation	 with respect	 to	 the	 potential	 benefits (including the integration	 of	 tons) related to (i) the	 acquisition (the " Schlüter Acquisition") of	 Schlüter	 Print	 Pharma	 Packaging (" Schlüter"), (ii)	 the	 acquisition	 (the "Plymouth	 Packaging	 Acquisition") of substantially	 all	 of	 the	 assets	 of	 Plymouth	 Packaging,	 Inc. ("Plymouth"), (iii)	 the	 July	 17,	 2017	 acquisition	 (the "Island	 Container Acquisition")	 of	 certain	 assets	 and	 liabilities	 of	 Island	 Container	 Corp.	 and	 Combined	 Container	 Industries	 LLC	 (" Island"), (iv)	 the acquisition	of	Hanna	Group	Pty	Ltd	("Hanna	Group")	in	a	stock	purchase	(the	"Hannapak	Acquisition"),	(v)	the	June	9,	2017	acquisition	of U.S.	Corrugated	Holdings,	Inc.	("U.S.	Corrugated	Acquisition"),	(vi)		the	MPS	Acquisition,	(vii)	the	March	13,	2017	acquisition	of	certain assets	and	liabilities	of	Star	Pizza	Box	of	Arizona,	LLC,	Star	Pizza	Box	of	Florida,	Inc.,	Star	Pizza	Box	of	Ohio,	LLC,	Star	Pizza	Box	of Texas,	LLC	and	Box	Logistics	LLC	(the	"Star	Pizza	Acquisition"	and	"Star	Pizza");	(viii)	the	January	19,	2016	acquisition	of	certain	legal entities	 formerly	 owned	 by	 Cenveo	 Inc.	 in	 a	 stock	 purchase	 (the "Packaging	 Acquisition"); (ix)	 the	 acquisition	 (the "SP	 Fiber Acquisition")	of	SP	Fiber	Holdings,	Inc.	(" SP	Fiber")	and	(x)	the	joint	venture	with	Gondi,	S.A.	de	C.V.	(" Grupo	Gondi");

•our	belief	that	the	Grupo	Gondi	joint	venture	is	helping	us	to	grow	our	presence	in	the	attractive	Mexican	market;

•that	we	expect	higher	cost	inflation	to	continue	through	fiscal	2019;

•our	belief	that	our	strong	balance	sheet	and	cash	flow	provide	us	the	flexibility	to	continue	to	invest	to	sustain	and	improve	our	operating performance;

•our	general	expectation	that	the	integration	of	a	closed	facility's	assets	and	production	with	other	facilities	will	enable	the	receiving	facilities to	better	leverage	their	fixed	costs	while	eliminating	fixed	costs	from	the	closed	facility;

•our	expectation	that	funding	for	our	domestic	operations	in	the	foreseeable	future	to	come	from	sources	of	liquidity	within	our	domestic operations,	including	cash	and	cash	equivalents,	and	available	borrowings	under	our	credit	facilities,	and	that	our	foreign	cash	and	cash equivalents	are	not	expected	to	be	a	key	source	of	liquidity	to	our	domestic	operations;

•our	expectation	that	capital	expenditures	in	fiscal	2019	will	be	approximately	$1.5	billion,	including	KapStone	and	investments	to	restore operations	our	Panama	City,	FL	mill	following	Hurricane	Michael,	our	base	capital	expenditures	in	fiscal	2019	will	be	approximately	$950 million	to	$1.0	billion,	with	roughly	half	invested	in	maintenance	and	half	invested	in	high	return	generating	projects,	and	we	expect	to	invest approximately	$0.5	billion	in	strategic	projects;

•our	expectation	that	we	will	utilize	the	remaining	U.S.	federal	net	operating	losses	and	other	U.S.	federal	credits	primarily	over	the	next	two years;

•our	expectation	that,	including	the	estimated	impact	of	book	and	tax	differences,	subject	to	changes	in	tax	laws,	our	cash	tax	rate	will	move closer	to	our	income	tax	rate	in	fiscal	2019,	2020	and	2021;

•our	estimation	that	we	will	invest	approximately	$22	million	for	capital	expenditures	during	fiscal	2019	in	connection	with	matters	relating	to environmental	compliance,	excluding	KapStone;

•our	expectation	that	we	will	contribute	approximately	$22	million	to	our	U.S.	and	non-U.S.	pension	plans	in	fiscal	2019;

•our	estimation	that	minimum	pension	contributions	to	our	U.S.	and	non-U.S.	pension	plans	will	be	in	the	range	of	approximately	$25	million to	$27	million	annually	in	fiscal	2020	through	2023;

•our	expectation	that	we	will	continue	to	make	contributions	in	the	coming	years	to	our	pension	plans	in	order	to	ensure	that	our	funding levels	remain	adequate	in	light	of	projected	liabilities	and	to	meet	the	requirements	of	the	Pension	Protection	Act	of	2006	("Pension	Act") and	other	regulations;

•our	beliefs	with	respect	to	material	changes	in	future	assumptions	and	estimates	related	to	allowances	and	impairment;

•our	belief	that	our	estimates	for	restructuring	costs	are	reasonable,	considering	our	knowledge	of	the	industries	we	operate	in,	previous experience	in	exiting	activities	and	valuations	we	may	obtain	from	independent	third	parties;

•our	belief	that	our	assumptions	are	reasonable	with	respect	to	health	insurance	costs,	workers'	compensation	cost	and	pension	and	other postretirement	benefit	obligations;

•our	expectation	of	the	impact	of	implementation	of	various	accounting	standards,	including	that	certain	of	these	standards	will	not	have	a material	effect	on	our	consolidated	financial	statements;

•our	belief	that	we	will	make	a	payment	in	the	first	quarter	of	fiscal	2019	related	to	the	Plymouth	Packaging	Acquisition;

•our	belief	that	the	MPS	Acquisition	will	increase	our	annual	paperboard	consumption	by	approximately	100,000	tons	to	be	supplied	by	us	by the	first	half	of	fiscal	2019;

•our	belief	that	our	restructuring	actions	have	allowed	us	to	more	effectively	manage	our	business;

•our	belief	that	by	investing	in	a	variety	of	asset	classes	and	utilizing	multiple	investment	management	firms,	we	can	create	a	portfolio	for	our pension	plans	that	yields	adequate	returns	with	reduced	volatility;

•our	belief	that	PIUMPF's	demand	related	to	our	withdrawal	will	include	both	a	payment	for	withdrawal	liability	and	for	our	proportionate share	of	PIUMPF's	accumulated	funding	deficiency;

•our	expectation	that	our	contributions	to	PIUMPF	will	not	continue	to	exceed	5%	of	total	plan	contributions;

•our	belief	that	our	tax	positions	are	appropriate;

•our	expectation	that	MWV	TN	(as	defined	herein)	will	only	repay	the	liability	at	maturity	from	the	Timber	Note	proceeds;

•our	belief	that	the	liability	for	environmental	matters	was	adequately	reserved	at	September	30,	2018;

•our	expectation	that	the	resolution	of	the	Antitrust	Litigation	(as	hereinafter	defined)	will	not	have	a	material	adverse	effect	on	our	results	of operations,	financial	condition	or	cash	flows;

•our	belief	that	we	have	valid	defenses	to	asbestos-related	personal	injury	claims	and	intend	to	continue	to	defend	them	vigorously,	and	that should	 the	 volume	 of	 asbestos-related	 personal	 injury	 litigation	 grow	 substantially,	 it	 is	 possible	 that	 we	 could	 incur	 significant	 costs resolving	these	cases;

•our	 expectation	 that	 the	 resolution	 of	 pending	 asbestos	 litigation	 and	 proceedings	 will	 not	 have	 a	 material	 adverse	 effect	 on	 our consolidated	financial	condition	or	liquidity	and	that	in	any	given	period	or	periods,	it	is	possible	that	asbestos-related	proceedings	or matters	could	have	a	material	adverse	effect	on	our	results	of	operations,	financial	condition	or	cash	flows;

•our	estimation	that	the	exposure	with	respect	to	certain	guarantees	we	have	made	could	be	approximately	$50	million;

•our	belief	that	our	exposure	related	to	guarantees	will	not	have	a	material	impact	on	our	results	of	operations,	financial	condition	or	cash flows;

•our	expectation	that	we	will	not	issue	additional	SARs;

•our	 anticipation	 that	 we	 will	 be	 able	 to	 fund	 our	 capital	 expenditures,	 interest	 payments,	 dividends	 and	 stock	 repurchases,	 pension payments,	working	capital	needs,	note	repurchases,	restructuring	activities,	repayments	of	current	portion	of	long-term	debt	and	other corporate	actions	for	the	foreseeable	future	from	cash	generated	from	operations,	borrowings	under	our	credit	facilities,	proceeds	from	our New	A/R	Sales	Agreement	(as	hereinafter	defined),	proceeds	from	the	issuance	of

debt	or	equity	securities	or	other	additional	long-term	debt	financing,	including	new	or	amended	facilities;

•that	we	may	seek	to	refinance	existing	indebtedness,	to	extend	maturities,	reduce	borrowing	costs	or	otherwise	improve	the	terms	and composition	of	our	indebtedness;

•that	we	may	enter	into	various	hedging	transactions,	including	interest	rate	swap	agreements	and	foreign-exchange	hedge	contracts;

•our	belief	that	in	the	event	of	a	distribution	in	the	form	of	dividends	or	dispositions	of	our	foreign	subsidiaries,	we	may	be	subject	to incremental	U.S.	income	taxes,	subject	to	an	adjustment	for	foreign	tax	credits,	and	withholding	taxes	or	income	taxes	payable	to	the foreign	jurisdictions;

•that	it	is	reasonably	possible	that	our	unrecognized	tax	benefits	will	decrease	by	up	to	$5.5	million	in	the	next	twelve	months	due	to expiration	of	various	statues	of	limitations	and	settlement	of	issues;	and

•the	expected	impact	of	market	risks,	such	as	interest	rate	risk,	pension	plan	risk,	foreign	currency	risk,	commodity	price	risks,	energy	price risk,	rates	of	return,	the	risk	of	investments	in	derivative	instruments,	and	the	risk	of	counterparty	nonperformance,	and	expected	factors affecting	those	risks,	including	our	exposure	to	foreign	currency	rate	fluctuations.

Forward-looking	statements	are	based	on	currently	available	information	and	our	current	assumptions,	expectations	and	projections	about	future events.	You	should	not	rely	on	our	forward-looking	statements.	These	statements	are	not	guarantees	of	future	performance	and	are	subject	to	future events,	risks	and	uncertainties	—	many	of	which	are	beyond	our	control,	dependent	on	actions	of	third	parties	or	currently	unknown	to	us	—	as	well	as potentially	inaccurate	assumptions	that	could	cause	actual	results	to	differ	materially	from	our	expectations	and	projections.	Particular	uncertainties	that could	cause	our	actual	results	to	be	materially	different	than	those	expressed	in	our	forward-looking	statements	include:	our	ability	to	achieve	benefits	from acquisitions	(including	 the	KapStone	Acquisition	(as	hereinafter	defined))	and	 the	 timing	 thereof,	 including	synergies,	performance	 improvements	and successful	implementation	of	capital	projects;	the	impact	of	the	Tax	Act	(as	hereinafter	defined);	risks	and	uncertainties	associated	with,	the	KapStone Acquisition	 (as	 hereinafter	 defined);	 the	 level	 of	 demand	 for	 our	 products;	 our	 ability	 to	 successfully	 identify	 and	 make	 performance	 improvements; anticipated	 returns	 on	 our	 capital	 investments;	 uncertainties	 related	 to	 planned	 and	 unplanned	 mill	 outages	 or	 production	 disruptions;	 investment performance,	discount	rates,	return	on	pension	plan	assets	and	expected	compensation	levels;	increases	in	energy,	raw	materials,	shipping	and	capital equipment	costs;	 fluctuations	 in	selling	prices	and	volumes;	 intense	competition;	 the	 impact	of	operational	restructuring	activities;	potential	 liability	 for outstanding	guarantees	and	indemnities	and	the	potential	impact	of	such	liabilities;	changes	in	law,	economic	and	financial	conditions,	including	interest	and exchange	rate	volatility,	commodity	and	equity	prices;	our	ability	to	maintain	our	current	credit	rating	and	the	impact	on	our	funding	costs	and	competitive position	if	we	do	not	do	so;	the	amount	and	timing	of	our	cash	flows	and	earnings	and	other	conditions,	which	may	affect	our	ability	to	pay	our	quarterly dividend	at	the	planned	level	or	to	repurchase	shares	at	planned	levels;	our	capital	allocation	plans,	as	such	plans	may	change	including	with	respect	to	the timing	and	size	of	share	repurchases,	acquisitions,	joint	ventures,	dispositions	and	other	strategic	actions;	the	impact	of	announced	price	increases	or decreases	 and	 the	 impact	 of	 the	 gain	 and	 loss	 of	 customers;	 compliance	 with	 governmental	 laws	 and	 regulations,	 including	 those	 related	 to	 the environment;	the	scope,	and	timing	and	outcome	of	any	litigation,	claims,	or	other	proceedings	or	dispute	resolutions,	including	the	Antitrust	Litigation	(as hereinafter	defined)	and	the	impact	of	any	such	litigation,	claims	or	other	proceedings	or	dispute	resolutions	on	our	results	of	operations,	financial	condition or	cash	flows;	income	tax	rates,	future	deferred	tax	expense	and	future	cash	tax	payments;	future	debt	repayment;	the	occurrence	of	severe	weather	or	a natural	disasters,	such	as	hurricanes	or	other	unanticipated	problems,	such	as	labor	difficulties,	equipment	failure	or	unscheduled	maintenance	and	repair, which	could	result	in	operational	disruptions	of	varied	duration;	and	other	factors	that	are	discussed	in	Item	1A.	"Risk	Factors".

Forward-looking	statements	speak	only	as	of	the	date	they	are	made,	and	we	do	not	undertake	to	update	these	statements	other	than	as	required	by law.	You	are	advised,	however,	to	review	any	further	disclosures	we	make	on	related	subjects	in	our	periodic	filings	with	the	SEC.

# Item	1A. RISK	FACTORS

We	are	subject	to	certain	risks	and	events	that,	 if	one	or	more	occur,	could	adversely	affect	our	results	of	operations,	cash	 flows	and	 financial condition,	and	 the	 trading	price	of	our	common	stock,	par	value	$0.01	per	share	("Common	Stock").	 In	evaluating	us,	our	business	and	a	potential investment	in	our	securities,	you	should	consider	the	following	risk	factors	and	the	other	information	presented	in	this	report,	as	well	as	the	other	reports and

registration	statements	we	file	from	time	to	time	with	the	SEC.	The	risks	addressed	below	are	not	the	only	ones	we	face.	Additional	risks	not	currently known	to	us	or	that	we	currently	believe	to	be	immaterial	could	also	adversely	impact	our	business	in	the	future.

# We	May	Experience	Pricing	Variability

Our	businesses	have	experienced,	and	are	likely	to	continue	experiencing,	cycles	relating	to	industry	capacity	and	general	economic	conditions.	The length	and	magnitude	of	these	cycles	have	varied	over	time	and	by	product.	Prices	for	our	products	are	driven	by	many	factors,	including	general	economic conditions,	demand	for	our	products	and	competitive	conditions	in	the	industries	within	which	we	compete,	and	we	have	little	influence	over	the	timing	and extent	of	price	changes,	which	may	be	unpredictable	and	volatile.	If	supply	exceeds	demand,	prices	for	our	products	could	decline,	and	our	results	of operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock	could	be	adversely	affected.	For	example,	we	believe	the	trading price	of	our	Common	Stock	was	adversely	affected	in	fiscal	2018	due,	in	part,	to	concerns	about	announcements	by	certain	of	our	competitors	of	planned additional	capacity	in	the	North	American	containerboard	market.

Further,	certain	published	 indices	contribute	 to	 the	setting	of	selling	prices for	some	of	our	products.	Future	changes in	how these indices	are established	or	maintained	could	adversely	impact	the	selling	prices	for	these	products.

# Our	Earnings	Are	Highly	Dependent	on	Volumes

Because	our	operations	generally	have	high	fixed	operating	cost	components,	our	earnings	are	highly	dependent	on	volumes,	which	tend	to	fluctuate. These	fluctuations	make	it	difficult	to	predict	our	financial	results	with	any	degree	of	certainty.	Any	failure	to	maintain	volumes	may	adversely	affect	our results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	May	Face	Increased	Costs	or	Inadequate	Availability	of	Raw	Materials,	Energy	and	Transportation

We	rely	heavily	on	the	use	of	certain	raw	materials,	energy	sources	and	third-party	companies	to	transport	our	goods.

The	costs	of	recycled	fiber	and	virgin	fiber,	the	principal	externally	sourced	raw	materials	for	our	mills,	are	subject	to	pricing	variability	due	to	market and	industry	conditions.	Increasing	demand	for	products	packaged	in	packaging	produced	from	paper	manufactured	from	100%	recycled	fiber,	greater demand	for	U.S.-sourced	recycled	fiber	by	Asian-based	paper	manufacturers	and	the	shift	by	manufacturers	of	virgin	paperboard,	tissue,	newsprint	and corrugated	packaging	to	the	production	of	products	with	some	recycled	fiber	content	have	and	may	continue	to	increase	demand	for	recycled	fiber,	which may	result	in	cost	increases.	Periods	of	higher	recycled	fiber	costs	and	unusual	price	volatility	have	occurred	in	the	past,	including	during	2017	as	demand for	domestic	recycled	fiber	from	Asian	producers	fluctuated	significantly.	The	market	price	of	virgin	fiber	varies	based	on	availability,	source	and	the	cost	of fuels	used	in	the	harvesting	and	transportation	of	virgin	fiber,	and	the	availability	of	virgin	fiber	may	be	impacted	by,	among	other	factors,	the	weather.	In addition,	costs	for	key	chemicals	used	in	our	manufacturing	operations	also	fluctuate,	which	impacts	our	manufacturing	costs.	Certain	published	indices contribute	to	price	setting	for	some	of	our	raw	materials.	Future	changes	in	how	these	indices	are	established	or	maintained	could	adversely	impact	the pricing	of	these	raw	materials.

The	cost	of	natural	gas,	which	we	use	in	many	of	our	manufacturing	operations,	including	many	of	our	mills,	and	other	energy	costs	(including	energy generated	by	burning	natural	gas,	fuel	oil,	biomass	and	coal)	has	at	times	fluctuated	significantly.	High	energy	costs	could	increase	our	operating	costs	and make	our	products	less	competitive	compared	to	similar	or	alternative	products	offered	by	competitors.

We	distribute	our	products	primarily	by	truck	and	rail,	although	we	also	distribute	some	of	our	products	by	cargo	ship.	The	reduced	availability	of	trucks, rail	cars	or	cargo	ships	could	negatively	impact	our	ability	to	distribute	our	products	in	a	timely	manner,	and	high	transportation	costs	could	make	our products	less	competitive	compared	to	similar	or	alternative	products	offered	by	competitors.	In	fiscal	2018,	the	profitability	of	our	operations	in	the	U.S.	was negatively	impacted	by	higher	transportation	costs	as	trucking	companies	raised	prices	to	address	a	shortage	of	drivers	and	strong	demand,	and	the profitability	of	our	operations	in	Brazil	was	negatively	impacted	by	a	truckers'	strike.

Because	our	businesses	operate	in	highly	competitive	industry	segments,	we	may	not	be	able	to	recoup	past	or	future	increases	in	the	cost	of	raw materials,	energy	or	 transportation	 through	price	 increases	 for	our	products.	The	 failure	 to	obtain	raw	materials,	energy	or	 transportation	services	at reasonable	 market	 prices	 (or	 the	 failure	 to	 pass	 on	 price	 increases	 to	 our	 customers)	 or	 a	 reduction	 in	 the	 availability	 of	 raw	 materials,	 energy	 or transportation	services	due	to	increased	demand,	significant	changes	in	climate	or	weather	conditions,	or	other	factors	could	adversely	affect	our	results	of operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	Face	Intense	Competition

We	 compete	 in	 industries	 that	 are	 highly	 competitive,	 and	 no	 single	 company	 dominates	 an	 industry.	 Our	 competitors	 include	 large	 and	 small, vertically	 integrated	companies	and	numerous	smaller	non-integrated	companies.	We	generally	compete	with	companies	operating	 in	North	America, although	we	have	operations	spanning	North	America,	South	America,	Europe,	Asia	and	Australia.	Factors	affecting	our	ability	to	compete	include	the	entry of	new	competitors	into	the	markets	we	serve,	increased	competition	from	overseas	producers,	our	competitors'	pricing	strategies,	the	introduction	by	our competitors	of	new	technologies	and	equipment,	our	ability	to	anticipate	and	respond	to	changing	customer	preferences	and	our	ability	to	maintain	the	cost- efficiency	of	our	facilities.	In	addition,	changes	within	these	industries,	including	the	consolidation	of	our	competitors	and	our	customers,	may	adversely affect	our	competitiveness.	If	our	competitors	are	more	successful	than	we	are	with	respect	to	any	key	competitive	factor,	our	results	of	operations,	cash flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected.

Our	products	also	compete,	to	some	extent,	with	various	other	packaging	materials,	including	products	made	of	paper,	plastics,	wood	and	various types	of	metal.	Customer	shifts	away	from	containerboard	and	paperboard	packaging	to	packaging	made	from	other	materials	could	adversely	affect	our results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	May	Be	Unsuccessful	in	Making	and	Integrating	Mergers,	Acquisitions	and	Investments	and	Completing	Divestitures

We	have	completed	a	number	of	mergers,	acquisitions,	investments	and	divestitures	in	recent	years,	including	the	Combination,	our	investment	in Grupo	Gondi,	the	Separation,	the	HH&B	Sale,	the	MPS	Acquisition	and	the	acquisition	(the	"KapStone	Acquisition")	of	all	of	the	outstanding	shares	of KapStone	Paper	and	Packaging	Corporation	("KapStone"),	and	we	may	acquire,	invest	in	or	sell,	or	enter	into	joint	ventures	with	additional	companies.	We may	not	be	able	to	identify	suitable	targets	or	purchasers	or	successfully	complete	suitable	transactions	in	the	future,	and	completed	transactions	may	not be	successful.	These	transactions	create	risks,	including,	but	not	limited	to,	risks	associated	with:

•disrupting	our	ongoing	business,	including	distracting	management	from	our	existing	businesses;

•integrating	acquired	businesses	and	personnel	into	our	business,	including	integrating	operations	across	different	cultures	and	languages,	and the	economic,	political	and	regulatory	risks	associated	with	specific	countries;

•working	with	partners	or	other	ownership	structures	with	shared	decision-making	authority;

•obtaining	and	verifying	relevant	information	regarding	a	business	prior	to	the	consummation	of	the	transaction,	including	the	identification	and assessment	of	liabilities,	claims	or	other	circumstances	that	could	result	in	litigation	or	regulatory	risk	exposure;

•obtaining	required	regulatory	approvals	and/or	financing	on	favorable	terms;

•retaining	key	employees,	contractual	relationships	or	customers;

•the	potential	impairment	of	tangible	and	intangible	assets	and	goodwill;

•the	additional	operating	losses	and	expenses	of	businesses	we	acquire	or	in	which	we	invest;

•implementing	controls,	procedures	and	policies	at	companies	we	acquire;	and

•the	dilution	of	interests	of	holders	of	our	Common	Stock	through	the	issuance	of	equity	securities.

In	addition,	mergers,	acquisitions	and	investments	may	not	be	successful	and	may	adversely	affect	our	results	of	operations,	cash	flows	and	financial condition,	and	the	trading	price	of	our	Common	Stock.	Among	the	benefits	we	expect	from	potential,	as	well	as	completed,	acquisitions	and	joint	ventures are	synergies,	cost	savings,	growth	opportunities	or	access	to	new	markets	(or	a	combination	thereof),	and	in	the	case	of	divestitures,	the	realization	of proceeds	 from	 the	 sale	 of	 businesses	 and	 assets	 to	 purchasers	 that	 place	 higher	 strategic	 value	 on	 these	 businesses	 and	 assets	 than	 we	 do.	 For acquisitions,	our	success	in	realizing	these	benefits	and	the	timing	of	realizing	them	depend	on	the	successful	integration	of	the	acquired	businesses	and operations	with	our	business	and	operations.	Even	if	we	are	able	to	integrate	these	businesses	and	operations	successfully,	we	may	not	realize	the	full benefits	we	expected	within	the	anticipated	timeframe,	or	at	all.	Accordingly,	the	benefits	from	acquisitions	may	be	offset	by	unanticipated	costs	or	delays	in integrating	the	acquired	companies.

On	 November	 2,	 2018,	 for	 example,	 we	 completed	 the	 KapStone	Acquisition.	 We	 expect	 the	 KapStone	Acquisition	 to	 generate	 synergies	 and performance	improvements	of	approximately	$200	million	by	the	end	of	fiscal	2021.	The	success	of	the	transaction	will	depend	on,	among	other	things,	our ability	to	realize	anticipated	growth	opportunities,	cost	savings	and	other	synergies.	Our	success	in	realizing	these	benefits,	and	the	timing	of	realizing	these benefits,	will	depend	on	us	successfully	integrating	the	KapStone	business	with	our	Corrugated	Packaging	business,	which	may	be	more	difficult,	complex, costly	and	time	consuming	than	we	expect.	The	integration	process	and	other	disruptions	resulting	from	the	KapStone	Acquisition	may	disrupt	ongoing businesses	or	cause	inconsistencies	 in	standards,	controls,	procedures	and	policies	 that	adversely	affect	our	relationships	with	employees,	suppliers, customers	and	others.	If	we	are	not	able	to	successfully	integrate	the	KapStone	business	within	the	anticipated	time	frame,	or	at	all,	the	expected	cost savings	and	synergies	and	other	benefits	of	the	KapStone	Acquisition	may	not	be	realized	fully,	or	at	all,	or	may	take	longer	or	cost	us	more	to	realize	than expected,	the	combined	businesses	may	not	perform	as	expected,	management's	time	and	energy	may	be	diverted,	and	our	results	of	operations,	cash flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected.

# Our	Acquisition	of	KapStone	Subjects	Us	to	Various	Risks	and	Uncertainties

As	a	result	of	the	KapStone	Acquisition,	we	are	subject	to	various	risks	and	uncertainties,	including	the	following:	we	may	fail	to	realize	anticipated synergies,	cost	savings,	operating	efficiencies	and	other	benefits;	our	incurrence	of	substantial	indebtedness	in	connection	with	financing	the	acquisition may	have	an	adverse	effect	on	our	liquidity,	limit	our	flexibility	in	responding	to	other	business	opportunities	and	increase	our	vulnerability	to	adverse economic	and	industry	conditions;	we	may	not	be	able	to	integrate	KapStone	into	our	operations	without	encountering	difficulties,	including	inconsistencies in	standards,	systems	and	controls,	and	without	diverting	management's	focus	and	resources	from	ordinary	business	activities	and	opportunities;	we	may face	challenges	retaining	KapStone's	customers	and	suppliers;	we	may	fail	to	retain	KapStone's	key	personnel;	we	may	encounter	unforeseen	internal control,	regulatory	or	compliance	issues;	and	we	may	face	other	additional	risks.		We	may	not	be	able	to	achieve	the	anticipated	benefits	from	the	KapStone Acquisition,	or	it	may	take	us	longer	or	cost	us	more	than	expected	to	achieve	them.	Any	of	the	foregoing	could	adversely	affect	our	results	of	operations, cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	 May	 Be	 Adversely	 Affected	 by	 Factors	 That	 Are	 Beyond	 Our	 Control,	 Such	 as	 U.S.	 and	 Worldwide	 Economic	 and	 Financial	 Market Conditions,	and	Social	and	Political	Change

Our	businesses	may	be	affected	by	a	number	of	factors	that	are	beyond	our	control,	such	as:

•general	economic	and	business	conditions;

•changes	in	tax	laws	or	tax	rates	and	conditions	in	the	financial	services	markets,	including	counterparty	risk,	insurance	carrier	risk,	rising	interest rates,	inflation,	deflation,	fluctuations	in	the	value	of	local	currency	versus	the	U.S.	dollar	and	the	impact	of	a	stronger	U.S.	dollar;

•financial	uncertainties	in	our	major	international	markets,	including	uncertainties	surrounding	the	United	Kingdom's	pending	withdrawal	from	the European	Union,	commonly	referred	to	as	"Brexit";

•social	and	political	change	impacting	matters	such	as	environmental	regulations	and	trade	policies	and	agreements;

•sluggish	 or	 uneven	 recovery,	 government	 deficit	 reduction	 and	 other	 austerity	 measures in	 specific	 countries	 or	 regions,	 or in the	 various industries	in	which	we	operate;	or

•other	factors,	each	of	which	may	adversely	impact	our	ability	to	compete.

For	example,	we	may	experience	lower	demand	for	our	products	and	the	products	of	our	customers	that	utilize	our	products	if	economic	conditions	in the	U.S.	and	globally	(including	locations	such	as	Europe,	Brazil	and	Mexico)

deteriorate	and	result	in	higher	unemployment	rates,	lower	family	income,	unfavorable	currency	exchange	rates,	lower	corporate	earnings,	lower	business investment	 or	 lower	 consumer	 spending.	 In	 addition,	 changes	 in	 trade	 policy,	 including	 renegotiating	 or	 potentially	 terminating,	 existing	 bilateral	 or multilateral	agreements,	as	well	as	the	imposition	of	tariffs,	could	impact	demand	for	our	products	and	the	costs	associated	with	certain	of	our	capital investments.	Macro-economic	challenges	may	also	lead	to	changes	in	tax	laws	or	tax	rates	that	may	have	a	material	impact	on	our	future	cash	taxes, effective	tax	rate	or	deferred	tax	assets	and	liabilities.	We	are	not	able	to	predict	with	certainty	economic	and	financial	market	conditions,	and	social	and political	change,	and	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected by	adverse	market	conditions	and	social	and	political	change.

# We	Cannot	Operate	Our	Joint	Ventures	Solely	For	Our	Benefit,	Which	Subjects	Us	to	Risks

We	have	invested	in	joint	ventures	when	circumstances	warranted	the	use	of	these	structures,	and	we	may	form	additional	joint	ventures	in	the	future. Our	participation	in	joint	ventures	is	subject	to	risks,	including,	but	not	limited	to,	risks	associated	with:

•shared	decision-making,	which	could	require	us	to	expend	additional	resources	to	resolve	impasses	or	potential	disputes;

•maintaining	good	relationships	with	our	partners,	which	could	limit	our	future	growth	potential;

•conflict	of	interest	issues	if	our	partners	have	competing	interests;

•investment	or	operational	goals	that	conflict	with	our	partners'	goals,	including	the	timing,	terms	and	strategies	for	investments	or	future	growth opportunities;

•our	partners'	ability	to	fund	their	share	of	required	capital	contributions	or	to	otherwise	fulfill	their	obligations	as	partners,	which	may	require	us	to infuse	our	own	capital	into	these	ventures	on	behalf	of	the	related	partner	despite	other	competing	uses	for	capital;	and

•obtaining	consents	from	our	partners	for	any	sale	or	other	disposition	of	our	interest	in	a	joint	venture	or	underlying	assets	of	the	joint	venture.

# We	May	Utilize	Our	Cash	Flow	or	Incur	Additional	Indebtedness	to	Satisfy	Certain	Payment	Obligations	or	Otherwise	Increase	our	Investment	in Grupo	Gondi

In	connection	with	our	investment	in	the	joint	venture	with	Grupo	Gondi,	we	entered	into	an	option	agreement	pursuant	to	which	we	and	certain shareholders	of	Grupo	Gondi	agreed	to	future	put	and	call	options	with	respect	to	the	equity	interests	in	the	joint	venture	held	by	each	party.	These arrangements,	or	other	arrangements	pursuant	to	which	we	increase	our	ownership	in	Grupo	Gondi,	may	require	us	to	dedicate	a	substantial	portion	of	our cash	flow	to	satisfy	our	payment	or	investment	obligations,	which	may	reduce	the	amount	of	funds	available	for	our	operations,	capital	expenditures	and corporate	development	activities.	Similarly,	we	may	be	required	to	incur	additional	indebtedness	to	satisfy	our	payment	or	investment	obligations.

# We	are	Exposed	to	Risks	Related	to	International	Sales	and	Operations

We	derived	19.9%	of	our	net	sales	in	fiscal	2018	from	outside	the	U.S.	through	international	operations,	some	of	which	were	transacted	in	U.S.	dollars. In	addition,	certain	of	our	domestic	operations	have	sales	to	foreign	customers.	Our	operating	results	and	business	prospects	could	be	adversely	affected by	risks	related	to	the	countries	outside	the	U.S.	in	which	we	have	manufacturing	facilities	or	sell	our	products.	Specifically,	Brazil,	China,	Mexico	and	India, where	we	maintain	operations	directly	or	through	a	joint	venture,	are	countries	that	are	exposed	to	economic,	political	and	social	instability.	We	are	exposed to	risks	of	operating	in	those	countries	as	well	as	many	others,	including,	but	not	limited	to,	risks	associated	with:

•the	difficulties	with	and	costs	of	complying	with	a	wide	variety	of	complex	laws,	treaties	and	regulations;

•unexpected	changes	in	political	or	regulatory	environments;	earnings	and	cash	flows	that	may	be	subject	to	tax	withholding	requirements	or	the imposition	of	tariffs,	exchange	controls	or	other	restrictions;

•repatriating	cash	from	foreign	countries	to	the	U.S.;

•political,	economic	and	social	instability;

•import	and	export	restrictions	and	other	trade	barriers;

•responding	to	disruptions	in	existing	trade	agreements	or	increased	trade	tensions	between	countries	or	political	and	economic	unions;

•maintaining	overseas	subsidiaries	and	managing	international	operations;

•obtaining	regulatory	approval	for	significant	transactions;

•government	limitations	on	foreign	ownership,	takeovers	or	nationalizations	of	business	or	mandated	price	controls;

•fluctuations	in	foreign	currency	exchange	rates;	and

•transfer	pricing.

Any	one	or	more	of	these	risks	could	adversely	affect	our	international	operations	and	our	results	of	operations,	cash	flows	and	financial	condition,	and the	trading	price	of	our	Common	Stock.

Our	corrugated	packaging	segment	and	consumer	packaging	segment	each	have	 large	customers,	 the	 loss	of	which	could	adversely	affect	 the segment's	sales	and,	depending	on	the	significance	of	the	loss,	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our Common	Stock.	In	particular,	because	our	businesses	operate	in	highly	competitive	industry	segments,	we	regularly	bid	for	new	business	or	for	the	renewal of	existing	business.	The	loss	of	business	from	our	larger	customers,	or	the	renewal	of	business	on	less	favorable	terms,	may	adversely	impact	our	financial results.

# We	May	Fail	to	Anticipate	Trends	That	Would	Enable	Us	to	Offer	Products	That	Respond	to	Changing	Customer	Preferences

Our	success	depends,	in	part,	on	our	ability	to	offer	differentiated	solutions,	and	we	must	continually	develop	and	introduce	new	products	and	services in	a	timely	manner	to	keep	pace	with	technological	and	regulatory	developments	and	changing	customer	preferences.	The	services	and	products	we	offer customers	may	not	meet	their	needs	as	their	business	models	evolve,	or	our	customers	may	decide	to	decrease	or	use	alternative	materials	for	their product	packaging	or	forego	the	packaging	of	certain	products	entirely.	Regulatory	developments	can	also	significantly	alter	the	market	for	our	solutions.	For example,	a	move	to	electronic	distribution	of	disclaimers	and	other	paperless	regimes	could	negatively	impact	our	healthcare	inserts	and	labels	businesses. Consumer	 preferences	 for	 products	 and	 packaging	 formats	 are	 constantly	 changing	 based	 on,	 among	 other	 factors,	 cost,	 convenience,	 and	 health, environmental	and	social	concerns	and	perceptions.	For	example,	changing	consumer	dietary	habits	and	preferences	have	slowed	sales	growth	for	many	of the	food	and	beverage	products	we	package.	Also,	we	believe	that	there	is	an	increasing	focus	among	consumers	to	ensure	that	products	delivered	through e-commerce	are	packaged	efficiently	and	we	are	working	with	our	customers	to	address	this	concern.	Our	results	of	operations,	cash	flows	and	financial condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected	if	we	fail	to	anticipate	trends	that	would	enable	us	to	offer	products	that respond	to	changing	customer	preferences.

# We	May	Produce	Faulty	or	Contaminated	Products	Due	to	Failures	in	Quality	Control	Measures	and	Systems

Our	failure	to	produce	products	that	meet	safety	and	quality	standards	could	result	in	adverse	effects	on	consumer	health,	litigation	exposure,	loss	of market	share	and	adverse	financial	impacts,	among	other	potential	consequences,	and	we	may	incur	substantial	costs	in	taking	appropriate	corrective action	(up	to	and	including	recalling	products	from	end	consumers)	and	to	reimburse	customers	and/or	end	consumers	for	losses	that	they	suffer	as	a	result of	these	failures.	Placing	an	unsafe	product	on	the	market,	failing	to	notify	the	regulatory	authorities	of	a	safety	issue,	failing	to	take	appropriate	corrective action	 and	 failing	 to	 meet	 other	 regulatory	 requirements	 relating	 to	 product	 safety	 could	 lead	 to	 regulatory	 investigation,	 enforcement	 action	 and/or prosecution.	Any	product	quality	or	safety	issue	may	also	result	in	adverse	publicity,	which	may	damage	our	reputation.	Any	of	these	results	could	adversely affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

We	provide	guarantees	in	certain	of	our	contracts	that	our	products	are	produced	in	accordance	with	customer	specifications	regarding	the	proper functioning	of	our	products	and	the	conformity	of	a	product	to	the	specific	use

defined	by	the	customer.	In	addition,	if	the	product	contained	in	packaging	manufactured	by	us	is	faulty	or	contaminated,	the	manufacturer	of	the	product may	allege	that	the	packaging	we	provided	caused	the	fault	or	contamination,	even	if	the	packaging	complies	with	contractual	specifications.	If	certain	of	our packaging	fails	to	open	properly	or	to	preserve	the	integrity	of	its	contents,	we	could	face	liability	to	our	customers	and	to	third	parties	for	bodily	injury	or other	damages	suffered	as	a	result.	These	liabilities	could	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price of	our	Common	Stock.

# We	May	Incur	Business	Disruptions

The	operations	at	our	manufacturing	facilities	may	be	interrupted	or	impaired	by	various	operating	risks,	including,	but	not	limited	to,	risks	associated with:

•catastrophic	 events,	 such	 as	 fires, floods,	 earthquakes,	 explosions,	 natural	 disasters,	 severe	 weather, including	 hurricanes, tornados	 and droughts,	or	other	similar	occurrences;

•interruptions	in	the	delivery	of	raw	materials	or	other	manufacturing	inputs;

•adverse	government	regulations;

•equipment	breakdowns	or	failures;

•prolonged	power	failures;

•unscheduled	maintenance	outages;

•information	system	failures;

•violations	of	our	permit	requirements	or	revocation	of	permits;

•releases	of	pollutants	and	hazardous	substances	to	air,	soil,	surface	water	or	ground	water;

•disruptions	in	the	transportation	infrastructure,	including	roads,	bridges,	railroad	tracks	and	tunnels;

•shortages	of	equipment	or	spare	parts;	and

•labor	disputes	and	shortages.

For	example,	in	2018,	operations	at	our	mills	located	in	Florence,	South	Carolina	and	Panama	City,	FL	were	interrupted	by	hurricanes,	resulting	in	lost mill	production	and	the	incurrence	of	damages,	supply	chain	disruptions	and	increased	input	costs.	See	"Note	23.	Subsequent	Events	(Unaudited)"	of	the Notes	to	Consolidated	Financial	Statements	for	additional	information	regarding	the	Panama	City,	FL	mill.

Business	disruptions	may	impair	our	production	capabilities	and	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the trading	price	of	our	Common	Stock.

# The	Level	of	Our	Indebtedness	Could	Adversely	Affect	Our	Financial	Condition	and	Impair	Our	Ability	to	Operate	Our	Business

At	September	30,	2018,	we	had	$6.4	billion	of	debt	outstanding.	In	connection	with	the	closing	of	the	KapStone	Acquisition,	we	incurred	approximately $4.4	billion	of	additional	debt.	The	level	of	our	indebtedness	could	have	important	consequences,	including:

•a	portion	of	our	cash	flows	from	operations	will	be	dedicated	to	payments	on	indebtedness	and	will	not	be	available	for	other	purposes,	including operations,	capital	expenditures	and	future	business	opportunities,	including	acquisitions;

•it	may	limit	our	ability	to	obtain	additional	financing	for	working	capital,	capital	expenditures,	future	business	opportunities,	acquisitions,	general corporate	and	other	purposes;

•our	indebtedness	that	is	subject	to	variable	rates	of	interest	exposes	us	to	increased	debt	service	obligations	in	the	event	of	increased	interest rates;

•it	may	limit	our	ability	to	adjust	to	changing	market	conditions	and	place	us	at	a	competitive	disadvantage	compared	to	competitors	that	have	less debt;	and

•it	may	increase	our	vulnerability	to	a	downturn	in	general	economic	conditions	or	in	our	business,	and	may	make	us	unable	to	carry	out	capital spending	that	is	important	to	our	growth	and	ability	to	maintain	our	competitiveness.

In	addition,	we	are	subject	to	agreements	that	require	us	to	meet	and	maintain	certain	financial	ratios	and	covenants	and	may	restrict	us	from,	among other	things,	disposing	of	assets	and	incurring	additional	indebtedness.	These	restrictions	may	limit	our	flexibility	to	respond	to	changing	market	conditions and	competitive	pressures.

# Downgrades	in	Our	Credit	Ratings	Could	Increase	Our	Borrowing	Costs

Some	of	our	outstanding	indebtedness	has	received	credit	ratings	from	rating	agencies.	These	ratings	are	limited	in	scope	and	do	not	purport	to address	all	risks	relating	to	an	investment	in	those	debt	securities.	Our	credit	ratings	could	change	based	on,	among	other	things,	our	results	of	operations and	financial	condition.	These	ratings	are	subject	to	ongoing	evaluation	by	credit	rating	agencies,	and	they	may	be	lowered,	suspended	or	withdrawn entirely	by	a	rating	agency	or	placed	on	a	so-called	"watch	list"	for	a	possible	downgrade	or	assigned	a	"negative	outlook"	if,	in	any	rating	agency's judgment,	circumstances	so	warrant.	Actual	or	anticipated	changes	or	downgrades	in	our	credit	ratings,	including	any	announcement	that	our	ratings	are under	review	for	a	downgrade	or	have	been	assigned	a	negative	outlook,	could	increase	our	borrowing	costs,	which	could	in	turn	adversely	affect	our results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.	If	a	downgrade	or	negative	outlook	were	to	occur,	it could	impact	our	ability	to	access	the	capital	markets	to	raise	debt	and/or	increase	the	cost	thereof.	In	addition,	while	our	credit	ratings	are	important	to	us, we	may	take	actions	and	otherwise	operate	our	business	in	a	manner	that	adversely	affects	our	credit	ratings.

# We	 are	 Subject	 to	 a	 Wide	 Variety	 of	 Laws,	 Regulations	 and	 Other	 Requirements	 That	 are	 Subject	 to	 Change	 and	 May Impose	 Substantial Compliance	Costs

We	 are	 subject	 to	 a	 wide	 variety	 of	 federal,	 state,	 local	 and	 foreign	 laws,	 regulations	 and	 other	 requirements,	 including	 those	 relating	 to	 the environment,	competition,	corruption,	health	and	safety,	 labor	and	employment,	data	privacy,	 tax	and	health	care.	These	 laws,	regulations	and	other requirements	may	change	or	be	applied	or	interpreted	in	ways	that	will	require	us	to	modify	our	operations,	subject	us	to	enforcement	risk	or	impose	on	or require	us	to	incur	additional	costs,	including	substantial	compliance	costs,	which	may	adversely	affect	our	results	of	operations,	cash	flows	and	financial condition,	and	the	trading	price	of	our	Common	Stock.

We	have	incurred,	and	expect	to	continue	to	incur,	significant	capital,	operating	and	other	expenditures	complying	with	applicable	environmental	laws and	regulations,	particularly	those	related	to	air	and	water	quality,	waste	disposal	and	the	cleanup	of	contaminated	soil	and	groundwater,	including	situations where	we	have	been	identified	as	a	PRP.	Because	environmental	regulations	are	constantly	evolving,	we	will	continue	to	incur	costs	to	maintain	compliance with	those	laws	and	our	compliance	costs	could	increase	materially.	Future	remediation	requirements	and	compliance	with	existing	and	new	laws	and requirements	may	disrupt	our	business	operations	and	require	significant	expenditures,	and	our	existing	reserves	for	specific	matters	may	not	be	adequate to	cover	future	costs.	In	particular,	our	manufacturing	operations	consume	significant	amounts	of	energy,	and	we	may	in	the	future	incur	additional	or increased	capital,	operating	and	other	expenditures	from	changes	due	to	new	or	increased	climate-related	and	other	environmental	regulations.	We	could also	incur	substantial	liabilities,	including	fines	or	sanctions,	enforcement	actions,	natural	resource	damages	claims,	cleanup	and	closure	costs,	and	third- party	claims	for	property	damage	and	personal	injury	under	environmental	and	common	laws.

The	Foreign	Corrupt	Practices	Act	of	1977	("FCPA")	and	local	anti-bribery	laws,	including	those	in	Brazil,	China,	Mexico,	India	and	the	United	Kingdom (where	 we	 maintain	 operations	 directly	 or	 through	 a	 joint	 venture),	 prohibit	 companies	 and	 their	 intermediaries	 from	 making	 improper	 payments	 to government	 officials	 for	 the	 purpose	 of	 influencing	 official	 decisions.	 Our	 internal	 control	 policies	 and	 procedures,	 or	 those	 of	 our	 vendors,	 may	 not adequately	protect	us	 from	reckless	or	criminal	acts	committed	or	alleged	 to	have	been	committed	by	our	employees,	agents	or	vendors.	Any	such violations	could	lead	to	civil	or	criminal	monetary	and	non-monetary	penalties	and/or	could	damage	our	reputation.

We	are	subject	to	a	number	of	labor	and	employment	laws	and	regulations	that	could	significantly	increase	our	operating	costs	and	reduce	our operational	flexibility.	Additionally,	changing	privacy	laws	in	the	United	States,	Europe	and	elsewhere,	including	the	adoption	by	the	European	Union	of	the General	Data	Protection	Regulation,	which	became	effective	in	May	2018,	have	created	new	individual	privacy	rights,	imposed	increased	obligations	on companies	handling	personal	data	and	increased	potential	exposure	to	fines	and	penalties.

In	December	2017,	the	U.S.	government	enacted	comprehensive	tax	legislation	commonly	referred	to	as	the	Tax	Cuts	and	Jobs	Act	(the	" Tax	Act"). The	Tax	Act	contains	significant	changes	to	corporate	taxation,	including	reduction	of	the	corporate	tax	rate	from	35%	to	21%,	additional	limitations	on	the tax	deductibility	of	interest,	substantial	changes	to	the	taxation	of	foreign	earnings,	immediate	deductions	for	certain	new	investments	instead	of	deductions for	depreciation	expense	over	time,	and	modification	or	repeal	of	many	business	deductions	and	credits.	Notwithstanding	the	reduction	in	the	corporate income	tax	rate,	the	overall	impact	of	the	Tax	Act	remains	uncertain.

# Our	Capital	Expenditures	May	Not	Achieve	the	Desired	Outcomes	or	May	Be	Achieved	at	a	Higher	Cost	than	Anticipated

We	regularly	make	capital	expenditures	and	many	of	our	projects	are	complex,	costly	and/or	implemented	over	an	extended	period	of	time.	For example,	in	fiscal	2018,	we	announced	a	significant	planned	investment	in	our	Florence,	South	Carolina	kraft	linerboard	mill	and	we	are	currently	in	the process	of	building	a	new	corrugated	box	plant	in	the	Brazilian	state	of	Sao	Paulo	and	upgrading	our	Tres	Barras	mill.	Our	capital	expenditures	for	these, and	other,	projects	could	be	higher	than	we	anticipated,	we	may	experience	unanticipated	business	disruptions	and/or	we	may	not	achieve	the	desired benefits	from	the	projects,	any	of	which	could	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our Common	Stock.	In	addition,	disputes	between	us	and	contractors	who	are	involved	with	implementing	projects	could	lead	to	time-consuming	and	costly litigation.

# We	May	Incur	Additional	Restructuring	Costs	and	May	Not	Realize	Expected	Benefits	from	Restructuring

We	have	previously	restructured	portions	of	our	operations,	and	we	may	engage	in	future	restructuring	initiatives.	Because	we	are	not	able	to	predict with	certainty	market	conditions,	including	changes	in	the	supply	and	demand	for	our	products,	the	loss	of	large	customers,	the	selling	prices	for	our products	or	the	cost	of	manufacturing	our	products,	we	also	may	not	be	able	to	predict	with	certainty	the	appropriate	time	to	undertake	restructurings.	The cash	and	non-cash	costs	associated	with	these	activities	vary	depending	on	the	type	of	facility	impacted,	with	the	non-cash	cost	of	a	mill	closure	generally being	more	significant	than	that	of	a	converting	facility	due	to	the	higher	level	of	investment.	Restructuring	activities	may	divert	the	attention	of	management, disrupt	our	operations	and	fail	to	achieve	the	intended	cost	and	operations	benefits.

# We	Have	a	Significant	Amount	of	Goodwill	and	Other	Intangible	Assets	and	a	Write-Down	Would	Adversely	Impact	Our	Operating	Results	and Shareholders'	Equity

At	September	30,	2018,	the	carrying	value	of	our	goodwill	and	intangible	assets	was	$8.7	billion.	We	review	the	carrying	value	of	our	goodwill	for impairment	annually,	or	more	frequently	when	impairment	indicators	exist.	The	impairment	test	requires	us	to	analyze	a	number	of	factors	and	make estimates	that	require	judgment.	During	the	fourth	quarter	of	fiscal	2018,	we	identified	our	Consumer	Packaging	reporting	unit	as	having	a	fair	value	that exceeded	its	carrying	value	by	less	than	10%.	Future	changes	in	the	cost	of	capital,	expected	cash	flows,	changes	in	our	business	strategy	and	external market	conditions,	among	other	factors,	could	require	us	to	record	an	impairment	charge	for	goodwill,	which	could	lead	to	decreased	assets	and	reduced net	income.	If	a	significant	write	down	were	required,	the	charge	could	have	a	material	adverse	effect	on	our	operating	results	and	shareholders'	equity,	and could	impact	the	trading	price	of	our	Common	Stock.	See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies	— Goodwill	and	Long-Lived	Assets"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# We	May	Be	Adversely	Impacted	By	Work	Stoppages	and	Other	Labor	Relations	Matters

A	significant	number	of	our	union	employees	are	governed	by	CBAs.	Expired	contracts	are	in	the	process	of	renegotiation,	and	others	expire	within one	year.	We	may	not	be	able	to	successfully	negotiate	new	union	contracts	without	work	stoppages	or	labor	difficulties	or	renegotiate	them	on	favorable terms.	We	have	experienced	work	stoppages	in	the	past	and	may	experience	them	in	the	future.	If	we	are	unable	to	successfully	renegotiate	the	terms	of any	of	these	agreements	or	an	industry	association	is	unable	to	successfully	negotiate	a	national	agreement	when	it	expires,	or	if	we	experience	any extended	interruption	of	operations	at	any	of	our	facilities	as	a	result	of	strikes	or	other	work	stoppages,	our	results	of	operations,	cash	flows	and	financial condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected.	In	addition,	our	businesses	rely	on	vendors,	suppliers	and	other	third parties	that	have	union	employees.	Strikes	or	work	stoppages	affecting	these	vendors,	suppliers	and	other	third	parties	could	adversely	affect	our	results	of operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# Certain	of	Our	Pension	Plans	Will	Likely	Require	Additional	Cash	Contributions

While	the	WestRock	Company	Consolidated	Pension	Plan	(the	" Plan")	is	over-funded,	we	expect	to	make	future	contributions	primarily	to	certain	of our	non-U.S.	pension	plans	in	the	coming	years	in	order	to	ensure	that	our	funding	levels	remain	adequate	and	meet	regulatory	requirements.	The	actual required	amounts	and	timing	of	future	cash	contributions	will	be	highly	sensitive	to	changes	in	the	applicable	discount	rates	and	returns	on	plan	assets,	and could	also	be	impacted	by	future	changes	in	the	laws	and	regulations	applicable	to	plan	funding.	Our	pension	plan	assets	are	primarily	made	up	of	fixed income,	equity	and	alternative	investments.	Fluctuations	in	the	market	performance	of	these	assets	and	changes	in	interest	rates	may	result	in	increased	or decreased	pension	plan	costs	in	future	periods.	Changes	in	assumptions	regarding	expected	long-term	rate	of	return	on	plan	assets,	our	discount	rate, expected	compensation	levels	or	mortality	could	also	increase	or	decrease	pension	costs.	These	changes,	along	with	future	turmoil	in	financial	and	capital markets,	may	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	May	Incur	Withdrawal	Liability	and/or	Increased	Funding	Requirements	in	Connection	with	the	MEPPs	in	Which	We	Participate

We	participate	in	several	MEPPs	that	provide	retirement	benefits	to	certain	union	employees	in	accordance	with	various	CBAs.	Our	contributions	to	a particular	MEPP	are	established	by	the	applicable	CBAs;	however,	our	required	contributions	may	increase	based	on	the	declining	funded	status	of	an MEPP	and	legal	requirements,	such	as	those	of	the	Pension	Act,	which	require	substantially	underfunded	MEPPs	to	implement	a	funding	improvement	plan ("FIP")	or	a	rehabilitation	plan	(" RP")	to	improve	their	funded	status.	Factors	that	could	impact	the	funded	status	of	a	MEPP	include,	without	limitation	a shrinking	contribution	base	as	a	result	of	the	insolvency	or	withdrawal	of	other	companies	that	currently	contribute	to	these	plans,	the	inability	or	failure	of companies	withdrawing	from	the	plan	to	pay	their	withdrawal	liability,	low	interest	rates,	changes	in	actuarial	assumptions	and/or	lower	than	expected returns	on	pension	fund	assets.

We	believe	that	certain	of	the	MEPPs	in	which	we	participate	or	have	participated,	including	PIUMPF,	have	material	unfunded	vested	benefits.	In	the normal	course	of	business,	we	evaluate	our	potential	exposure	 to	MEPPs,	 including	with	respect	 to	potential	withdrawal	 liabilities.	 In	 fiscal	2018,	we submitted	formal	notification	to	withdraw	from	PIUMPF	and	the	Central	Sates,	Southeast	and	Southwest	Areas	Pension	Fund	("Central	States")	 and recorded	aggregate	withdrawal	liabilities	of	$184.2	million,	which	includes	an	estimate	of	our	portion	of	PIUMPF's	accumulated	funding	deficiency.	Our withdrawal	liability	for	any	particular	MEPP	would	depend	on	the	nature	and	timing	of	any	triggering	event	and	the	extent	of	that	MEPP's	funding	of	vested benefits.	In	addition,	we	may	be	obligated	to	pay	a	share	of	a	particular	MEPP's	accumulated	funding	deficiency	as	determined	under	the	Pension	Act.	Due to	the	absence	of	specific	information	regarding	the	applicable	funded	status	and	other	relevant	information	for	each	MEPP,	we	are	unable	to	determine with	certainty	the	exact	amount	of	any	withdrawal	liability	and	our	estimate	for	withdrawing	from	PIUMPF	is	subject	to	revision.	We	may	withdraw	from	other MEPPs	in	the	future.

The	impact	of	increased	contributions,	future	funding	obligations	or	future	withdrawal	liabilities	may	adversely	affect	our	results	of	operations,	cash flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.	See	"Note	4.	Retirement	Plans	—	Multiemployer	Plans "	of	the	Notes	to Consolidated	Financial	Statements	for	additional	information.

# We	are	Subject	to	Cyber-Security	Risks,	Including	Related	to	Customer,	Employee,	Vendor	or	Other	Company	Data

We	use	information	technologies	to	securely	manage	operations	and	various	business	functions.	We	rely	on	various	technologies,	some	of	which	are managed	by	third	parties,	to	process,	transmit	and	store	electronic	information,	and	to	manage	or	support	a	variety	of	business	processes	and	activities, including	reporting	on	our	business	and	 interacting	with	customers,	vendors	and	employees.	 In	addition,	we	collect	and	store	certain	data,	 including proprietary	business	information,	and	may	have	access	to	confidential	or	personal	information	in	certain	of	our	businesses	that	is	subject	to	privacy	and security	laws,	regulations	and	customer-imposed	controls.	Our	systems	are	subject	to	repeated	attempts	by	third	parties	to	access	information	or	to	disrupt our	systems.	Despite	our	security	design	and	controls,	and	those	of	our	third-party	providers,	we	may	become	subject	to	system	damage,	disruptions	or shutdowns	 due	 to	 any	 number	 of	 causes,	 including	 cyber-attacks,	 breaches,	 employee	 error	 or	 malfeasance,	 power	 outages,	 computer	 viruses, telecommunication	or	utility	failures,	systems	failures,	service	providers,	natural	disasters	or	other	catastrophic	events.	It	is	possible	for	such	vulnerabilities to	remain	undetected

for	an	extended	period	of	time.	We	may	face	other	challenges	and	risks	as	we	upgrade	and	standardize	our	information	technology	systems	as	part	of	our integration	of	acquired	businesses	and	operations.	We	maintain	contingency	plans	to	prevent	or	mitigate	the	impact	of	these	events,	however,	these	events could	result	in	operational	disruptions	or	the	misappropriation	of	sensitive	data,	and	depending	on	their	nature	and	scope,	could	lead	to	the	compromise	of confidential	 information,	 improper	use	of	our	systems	and	networks,	manipulation	and	destruction	of	data,	defective	products,	production	downtimes, operational	disruptions	and	exposure	to	liability.	Such	disruptions	or	misappropriations	and	the	resulting	repercussions,	including	reputational	damage	and legal	claims	or	proceedings,	may	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	Depend	On	Our	Ability	to	Develop	and	Successfully	Introduce	New	Products	and/or	to	Acquire	and	Retain	Intellectual	Property	Rights

Our	ability	to	develop	and	successfully	market	new	products	and	to	develop,	acquire	and/or	retain	necessary	intellectual	property	rights	is	important	to our	continued	success	and	competitive	position.	If	we	are	unable	to	develop	and	successfully	introduce	new	products,	protect	our	existing	intellectual property	rights	or	develop	new	intellectual	property	rights,	or	if	others	develop	similar	or	improved	technologies,	our	results	of	operations,	cash	flows	and financial	condition,	and	the	trading	price	of	our	Common	Stock,	could	be	adversely	affected.

# We	are	Subject	to	Risks	Associated	with	Monetizing	our	Land	and	Development	Asset	Portfolio

In	fiscal	2016,	we	commenced	an	accelerated	monetization	strategy	of	various	real	estate	holdings	that	are	concentrated	in	the	Charleston,	SC	region and	we	expect	to	complete	this	process	during	fiscal	2019.	Our	ability	to	execute	our	plans	may	be	affected	by	general	economic	conditions,	including	credit markets	and	interest	rates,	local	real	estate	market	conditions,	including	competition	from	sellers	of	land	and	real	estate	developers,	and	the	impact	of federal,	state	and	local	laws	and	regulations	affecting	land	use,	land	use	entitlements,	land	protection	and	zoning,	among	other	factors.	Any	failure	to execute	our	plans	could	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	May	Fail	to	Attract,	Motivate,	Train	and	Retain	Qualified	Personnel,	Including	Key	Personnel

Our	ability	to	maintain	and	expand	our	business	depends	on	our	ability	to	attract,	motivate,	train	and	retain	employees	with	the	skills	necessary	to understand	and	adapt	to	the	continuously	developing	needs	of	our	customers.	The	increasing	demand	for	qualified	personnel	makes	it	more	difficult	for	us to	attract	and	retain	employees	with	requisite	skill	sets,	particularly	employees	with	specialized	technical	and	trade	experience.	Changing	demographics	and labor	work	force	trends	also	may	result	in	a	loss	of	knowledge	and	skills	as	experienced	workers	retire.	If	we	fail	to	attract,	motivate,	train	and	retain	qualified personnel,	or	if	we	experience	excessive	turnover,	we	may	experience	declining	sales,	manufacturing	delays	or	other	inefficiencies,	increased	recruiting, training	and	relocation	costs	and	other	difficulties,	and	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common Stock	may	be	adversely	impacted.

In	addition,	we	rely	on	key	executive	and	management	personnel	to	manage	our	business	efficiently	and	effectively.		As	our	business	has	grown	in size	and	geographic	scope,	we	have	relied	on	these	individuals	to	manage	increasingly	complex	projects,	teams	and	operations,	and	to	allocate	resources to	match	the	size	and	geographic	scope	of	our	business.	The	loss	of	any	of	our	key	personnel	could	adversely	affect	our	results	of	operations,	cash	flows and	financial	condition,	and	the	trading	price	of	our	Common	Stock	may	be	adversely	impacted.	Effective	succession	planning	is	also	important	to	our	long- term	success.	Our	failure	to	identify	candidates	with	the	leadership	skills	to	manage	our	increasingly	complex	organization,	and	our	 failure	 to	ensure effective	transfers	of	knowledge	and	smooth	transitions	involving	key	executives,	could	hinder	our	strategic	planning	and	execution.

# The	Separation	Could	Result	in	Substantial	Tax	Liability	to	Us	and	to	Those	of	Our	Stockholders	Who	Received	Ingevity	Stock	at	the	Time	of	the Separation

We	have	received	an	opinion	from	outside	tax	counsel	to	the	effect	that	the	Separation	qualifies	as	a	transaction	that	is	described	in	Sections	355	and 368(a)(1)(D)	of	the	Internal	Revenue	Code	of	1986,	as	amended,	and	the	rules	and	regulations	thereunder	("Code").	The	opinion	relies	on	certain	facts, assumptions,	representations	and	undertakings	from	Ingevity	and	us	regarding	the	past	and	future	conduct	of	each	of	the	two	companies'	respective businesses	and	other	matters.	If	any	of	these	facts,	assumptions,	representations	or	undertakings	prove	to	be

incorrect	or	not	satisfied,	or	if	the	U.S.	Internal	Revenue	Service	(" IRS")	otherwise	determines	on	audit	that	the	Separation	is	taxable,	our	stockholders	who received	Ingevity	stock	at	the	time	of	the	Separation	and/or	we	may	not	be	able	to	rely	on	the	opinion	of	tax	counsel	and	could	be	subject	to	significant	tax liabilities.	If	the	Separation	is	determined	to	be	taxable	to	those	of	our	stockholders	who	received	Ingevity	stock	at	the	time	of	the	Separation,	each	of	those stockholders	would	generally	be	treated	as	having	received	a	taxable	distribution	of	property	in	an	amount	equal	to	the	fair	market	value	of	the	Ingevity shares	received.

Even	 if	 the	Separation	otherwise	qualifies	as	a	 tax-free	 transaction	 to	 those	of	our	stockholders	who	received	 Ingevity	stock	at	 the	 time	of	 the Separation,	 the	 distribution	 could	 be	 taxable	 to	 us	 in	 certain	 circumstances	 if	 future	 significant	 acquisitions	 of	 our	 stock	 or	 the	 stock	 of	 Ingevity	 are determined	to	be	part	of	a	plan	or	series	of	related	transactions	that	included	the	Separation.	In	this	event,	the	resulting	tax	liability	would	be	substantial.	In connection	with	the	Separation,	we	entered	into	a	tax	matters	agreement	with	Ingevity,	pursuant	to	which	Ingevity	agreed	(a)	to	not	engage	in	certain transactions	that	could	cause	the	Separation	to	be	taxable	to	us	and	(b)	to	indemnify	us	for	any	tax	liabilities	resulting	from	such	transactions.	The	indemnity from	 Ingevity	may	not	be	sufficient	 to	protect	us	against	 the	 full	amount	of	such	 liabilities.	Any	 tax	 liabilities	resulting	 from	 the	Separation	or	related transactions	could	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our	Common	Stock.

# We	May	Be	Exposed	to	Claims	and	Liabilities	as	a	Result	of	the	Separation

We	entered	into	a	separation	and	distribution	agreement	and	various	other	agreements	with	Ingevity	to	govern	the	Separation	and	the	relationship	of the	two	companies	going	forward.	These	agreements	provide	for	specific	indemnity	and	liability	obligations	and	could	lead	to	disputes	between	us	and Ingevity.	The	indemnity	rights	we	have	against	Ingevity	under	the	agreements	may	not	be	sufficient	to	protect	us.	In	addition,	our	indemnity	obligations	to Ingevity	may	be	significant	and	these	risks	could	adversely	affect	our	results	of	operations,	cash	flows	and	financial	condition,	and	the	trading	price	of	our Common	Stock.

# Item	1B. UNRESOLVED	STAFF	COMMENTS

There	are	no	unresolved	SEC	staff	comments.

# Item	2. PROPERTIES

We	operate	locations	in	North	America,	including	the	majority	of	U.S.	states,	South	America,	Europe,	Asia	and	Australia.	We	lease	our	principal	offices in	Atlanta,	GA.		We	believe	that	our	existing	production	capacity	is	adequate	to	serve	existing	demand	for	our	products	and	consider	our	plants	and equipment	to	be	in	good	condition.

Our	corporate	and	operating	facilities	as	of	September	30,	2018	are	summarized	below:

|  |  | Number	of	Facilities |  |
| :--- | :--- | :--- | :--- |
| Segment | Owned | Leased | Total |
| Corrugated\tPackaging | 97 | 50 | 147 |
| Consumer\tPackaging | 84 | 57 | 141 |
| Corporate\tand\tsignificant\tregional\toffices | — | 10 | 10 |
| Total | 181 | 117 | 298 |

The	tables	that	follow	show	our	annual	production	capacity	by	mill	at	September	30,	2018	in	thousands	of	tons.	Our	mill	system	production	levels	and operating	rates	may	vary	from	year	to	year	due	to	changes	in	market	and	other	factors,	including	the	impact	of	hurricanes	and	other	weather-related	events. Our	simple	average	mill	system	operating	rates	for	the	last	three	years	averaged	96%.	We	own	all	of	our	mills.

# Corrugated	Packaging	Mills	-	annual	production	capacity	in	thousands	of	tons

| Location	of	Mill | Linerboard | Medium | White	Top<br>Linerboard | Kraft<br>Paper/Bag | Market<br>Pulp | Bleached<br>Paperboard | Total<br>Capacity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Fernandina\tBeach,\tFL | 930 |  |  |  |  |  | 930 |
| West\tPoint,\tVA |  | 185 | 735 |  |  |  | 920 |
| Stevenson,\tAL |  | 885 |  |  |  |  | 885 |
| Solvay,\tNY | 548 | 272 |  |  |  |  | 820 |
| Hodge,\tLA | 800 |  |  |  |  |  | 800 |
| Florence,\tSC | 683 |  |  |  |  |  | 683 |
| Panama\tCity,\tFL\t(1) | 353 |  |  |  | 292 |  | 645 |
| Dublin,\tGA | 137 | 137 |  | 341 |  |  | 615 |
| Seminole,\tFL | 402 | 198 |  |  |  |  | 600 |
| Hopewell,\tVA | 527 |  |  |  |  |  | 527 |
| Tres\tBarras,\tBrazil | 345 | 175 |  |  |  |  | 520 |
| Tacoma,\tWA | 90 |  | 275 | 60 | 60 |  | 485 |
| La\tTuque,\tQC |  |  | 345 |  |  | 131 | 476 |
| St.\tPaul,\tMN |  | 200 |  |  |  |  | 200 |
| Morai,\tIndia | 155 | 25 |  |  |  |  | 180 |
| Total\tCorrugated\tPackaging\n\t\t\tMill\tCapacity | 4,970 | 2,077 | 1,355 | 401 | 352 | 131 | 9,286 |

(1) Our	Panama	City,	FL	mill	sustained	extensive	damage	from	Hurricane	Michael	in	October	2018.	In	early	November,	the	mill	started	producing linerboard	and	we	expect	to	ramp	up	to	full	production	by	the	end	of	November	2018.	Our	market	pulp	production	line	is	expected	to	operate	at 50%	of	capacity	by	early	December	2018	and	should	return	to	full	operation	in	approximately	six	months.

Our	fiber	sourcing	for	our	Corrugated	Packaging	mills	is	approximately	60%	virgin	and	40%	recycled.	After	the	KapStone	Acquisition,	which	adds approximately	3.0	million	tons	of	capacity,	our	mix	is	approximately	65%	virgin	and	35%	recycled.

# Consumer	Packaging	Mills	-	annual	production	capacity	in	thousands	of	tons

|  |  | Coated | Coated | Specialty |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Bleached | Natural | Recycled | Recycled | Market | Total |
| Location\tof\tMill | Paperboard | Kraft | Paperboard | Paperboard | Pulp | Capacity |
| Mahrt,\tAL |  | 1,066 |  |  |  | 1,066 |
| Covington,\tVA | 950 |  |  |  |  | 950 |
| Evadale,\tTX | 660 |  |  |  | 40 | 700 |
| Demopolis,\tAL | 360 |  |  |  | 110 | 470 |
| St.\tPaul,\tMN |  |  | 170 |  |  | 170 |
| Battle\tCreek,\tMI |  |  | 160 |  |  | 160 |
| Chattanooga,\tTN |  |  |  | 140 |  | 140 |
| Dallas,\tTX |  |  | 127 |  |  | 127 |
| Sheldon\tSprings,\tVT\t(Missisquoi\tMill) |  |  | 111 |  |  | 111 |
| Lynchburg,\tVA |  |  |  | 103 |  | 103 |
| Stroudsburg,\tPA |  |  | 80 |  |  | 80 |
| Eaton,\tIN |  |  |  | 64 |  | 64 |
| Aurora,\tIL |  |  |  | 32 |  | 32 |
| Total\tConsumer\tPackaging\n\t\t\tMill\tCapacity | 1,970 | 1,066 | 648 | 339 | 150 | 4,173 |

The	production	at	our	Lynchburg,	VA	mill	is	gypsum	paperboard	liner	and	the	paper	machine	at	this	mill	is	owned	by	our	Seven	Hills	joint	venture.	Our fiber	sourcing	for	our	Consumer	Packaging	mills	is	approximately	75%	virgin	and	25%	recycled.	Our	fiber	sourcing	for	mills	is	approximately	65%	virgin	and 35%	recycled.	After	the	KapStone	Acquisition,	our	mix	is	approximately	67%	virgin	and	33%	recycled.

At	September	30,	2018,	we	owned	approximately	135,000	acres	of	forestlands	in	Brazil.

# Item	3. LEGAL	PROCEEDINGS

We	are	a	defendant	in	a	number	of	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,	we	believe	 the	resolution	of	 these	matters	will	not	have	a	material	adverse	effect	on	our consolidated	financial	condition,	results	of	operations	or	cash	flows.

See	"Note	17.	Commitments	and	Contingencies"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Item	4. MINE	SAFETY	DISCLOSURES

Not	applicable.

# PART	II:	FINANCIAL	INFORMATION

# Item	5. MARKET	 FOR	 THE	 REGISTRANT'S	 COMMON	 EQUITY,	 RELATED	 STOCKHOLDER	 MATTERS	 AND ISSUER	 PURCHASES	 OF EQUITY	SECURITIES

# Common	Stock

Our	Common	Stock	trades	on	the	New	York	Stock	Exchange	(" NYSE")	under	the	symbol	"WRK".	As	of	October	26,	2018,	there	were	approximately 6,843	stockholders	of	record	of	our	Common	Stock.	The	number	of	stockholders	of	record	includes	one	single	stockholder,	Cede	&	Co.,	for	all	of	the	shares of	our	Common	Stock	held	by	our	stockholders	in	individual	brokerage	accounts	maintained	at	banks,	brokers	and	institutions.

# Dividends

In	October	2018,	our	board	of	directors	declared	a	quarterly	dividend	of	$0.455	per	share,	representing	a	5.8%	increase	from	the	prior	$0.43	per	share quarterly	dividend	and	an	annual	dividend	of	$1.82	per	share.	During	fiscal	2018,	we	paid	an	annual	dividend	of	$1.72	per	share.	During	fiscal	2017,	we paid	an	annual	dividend	of	$1.60	per	share.	During	fiscal	2016,	we	paid	an	annual	dividend	of	$1.50	per	share.

# Securities	Authorized	for	Issuance	Under	Equity	Compensation	Plans

See	Part III, Item	12	of this	Form	10-K	and "Note	19.	Stockholders'	Equity"	of the	Notes to	Consolidated	Financial	Statements for	additional information.

# Stock	Repurchase	Plan

The	following	table	presents	information	with	respect	to	purchases	of	our	Common	Stock	that	we	made	during	the	three	months	ended	September 30,	2018:

# Issuer	Purchases	of	Equity	Securities

| Period | Total	Number	of<br>Shares<br>Purchased | Average<br>Price	Paid<br>Per	Share | Total	Number	of	Shares<br>Purchased	as	Part	of<br>Publicly	Announced<br>Plans	or	Programs | Maximum	Number	of<br>Shares	that	May	Yet<br>Be	Purchased	Under<br>the	Plans	or<br>Programs |
| :--- | :--- | :--- | :--- | :--- |
| July\t1,\t2018\tthrough\tJuly\t31,\t2018 | — | $— | — | 22,975,289 |
| August\t1,\t2018\tthrough\tAugust\t31,\t2018 | 368,513 | 54.92 | 368,513 | 22,606,776 |
| September\t1,\t2018\tthrough\tSeptember\t30, |  |  |  |  |
| \t\t\t2018 | 1,343,930 | 55.10 | 1,343,930 | 21,262,846 |
| Total | 1,712,443 |  | 1,712,443 |  |

See	"Note	19.	Stockholders'	Equity"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Item	6. SELECTED	FINANCIAL	DATA

The	following	selected	consolidated	financial	data	should	be	read	in	conjunction	with	our	consolidated	financial	statements	and	notes	thereto	and Item	7.	"Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations ".	RockTenn	was	the	accounting	acquirer	in	the Combination;	therefore,	the	historical	consolidated	financial	statements	of	RockTenn	for	periods	prior	to	the	Combination	are	considered	to	be	the	historical financial	 statements	 of	 WestRock	 and	 thus	 WestRock's	 consolidated	 financial	 statements	 for	 fiscal	 2015	 reflect	 RockTenn's	 consolidated	 financial statements	for	periods	from	October	1,	2014	through	June	30,	2015,	and	WestRock's	thereafter.	We	derived	the	consolidated	statements	of	operations	and consolidated	statements	of	cash

flows	data	for	the	years	ended	September	30,	2018,	2017	and	2016	and	the	consolidated	balance	sheet	data	as	of	September	30,	2018	and	2017	from	the Consolidated	Financial	Statements	included	herein.	We	derived	the	consolidated	statements	of	operations	and	consolidated	statements	of	cash	flows	data for	the	year	ended	September	30,	2015	and	2014	and	the	consolidated	balance	sheet	data	as	of	September	30,	2016	and	2015	from	audited	WestRock Company	consolidated	financial	statements	not	included	in	this	report.	We	derived	the	consolidated	balance	sheet	data	as	of	September	30,	2014,	from audited	Rock-Tenn	Company	consolidated	financial	statements	not	included	in	this	report.

The	Combination	was	the	primary	reason	for	the	changes	in	the	selected	financial	data	in	fiscal	2016	and	2015	as	compared	to	prior	years	due	to	the size	and	timing	of	the	transaction.	The	selected	financial	data	has	been	updated	to	reflect	the	Separation.	Our	results	of	operations	shown	below	may	not be	indicative	of	future	results.

| (In	millions,	except	per	share	amounts) | 2018 | 2017 | Year	Ended	September	30,<br>2016 | 2015 | 2014 |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $16,285.1 | $14,859.7 | $14,171.8 | $11,124.8 | $9,895.1 |
| Multiemployer\tpension\twithdrawals\t(1) | $184.2 | $— | $— | $— | $— |
| Pension\trisk\ttransfer\texpense\t(2) | $— | $— | $370.7 | $— | $— |
| Pension\tlump\tsum\tsettlement\tand\tretiree\tmedical |  |  |  |  |  |
| \t\t\tcurtailment,\tnet\t(3) | $— | $32.6 | $— | $11.5 | $47.9 |
| (4)\nLand\tand\tDevelopment\timpairments | $31.9 | $46.7 | $— | $— | $— |
| Restructuring\tand\tother\tcosts\t(5) | $105.4 | $196.7 | $366.4 | $140.8 | $55.6 |
| Gain\ton\tsale\tof\tHH&amp;B\t(6) | $— | $192.8 | $— | $— | $— |
| Income\tfrom\tcontinuing\toperations\t (7) | $1,909.3 | $698.6 | $154.8 | $501.2 | $483.8 |
| (Loss)\tincome\tfrom\tdiscontinued\toperations |  |  |  |  |  |
| \t\t\t(net\tof\ttax)\t(8) | $— | $— | $(544.7) | $10.6 | $— |
| Net\tincome\t(loss)\tattributable\tto |  |  |  |  |  |
| \t\t\tcommon\tstockholders | $1,906.1 | $708.2 | $(396.3) | $507.1 | $479.7 |
| Diluted\tearnings\tper\tshare\tfrom |  |  |  |  |  |
| \t\t\tcontinuing\toperations | $7.34 | $2.77 | $0.59 | $2.87 | $3.29 |
| Diluted\t(loss)\tearnings\tper\tshare\tfrom |  |  |  |  |  |
| \t\t\tdiscontinued\toperations | $— | $— | $(2.13) | $0.06 | $— |
| Diluted\tearnings\t(loss)\tper\tshare\tattributable |  |  |  |  |  |
| \t\t\tto\tcommon\tstockholders | $7.34 | $2.77 | $(1.54) | $2.93 | $3.29 |
| Diluted\tweighted\taverage\tshares\toutstanding | 259.8 | 255.7 | 257.9 | 173.3 | 146.0 |
| Dividends\tpaid\tper\tcommon\tshare | $1.72 | $1.60 | $1.50 | $1.20 | $0.70 |
| Book\tvalue\tper\tcommon\tshare | $45.24 | $40.64 | $38.75 | $45.34 | $30.76 |
| Total\tassets | $25,360.5 | $25,089.0 | $23,038.2 | $25,372.4 | $11,039.7 |
| Current\tportion\tof\tdebt | $740.7 | $608.7 | $292.9 | $63.7 | $132.6 |
| Long-term\tdebt\tdue\tafter\tone\tyear | $5,674.5 | $5,946.1 | $5,496.3 | $5,558.2 | $2,852.1 |
| Total\tdebt | $6,415.2 | $6,554.8 | $5,789.2 | $5,621.9 | $2,984.7 |
| Total\tstockholders'\tequity | $11,469.4 | $10,342.5 | $9,728.8 | $11,651.8 | $4,306.8 |
| Net\tcash\tprovided\tby\toperating\tactivities | $2,420.9 | $1,900.5 | $1,688.4 | $1,203.6 | $1,151.8 |
| Capital\texpenditures | $999.9 | $778.6 | $796.7 | $585.5 | $534.2 |
| Cash\tpaid\t(received)\tfor\tpurchase\tof |  |  |  |  |  |
| \t\t\tbusinesses,\tnet\tof\tcash\tacquired | $239.9 | $1,588.5 | $376.4 | $(3.7) | $474.4 |
| Cash\treceived\tin\tmerger | $— | $— | $— | $265.7 | $— |
| Purchases\tof\tcommon\tstock | $195.1 | $93.0 | $335.3 | $336.7 | $236.3 |
| Purchases\tof\tcommons\tstock\t-\tmerger\trelated | $— | $— | $— | $667.8 | $— |
| Cash\tdividends\tpaid\tto\tstockholders | $440.9 | $403.2 | $380.7 | $214.5 | $101.1 |

(1) In	fiscal	2018,	we	recorded	an	estimated	withdrawal	liability	of	$180.0	million	to	withdraw	from	PIUMPF	and	$4.2	million	to	withdraw	from	Central	States.	See "Note	4.	Retirement	Plans	—	Multiemployer	Plans"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

(2) In	fiscal	2016,	we	used	plan	assets	to	settle	$2.5	billion	of	pension	obligations	of	the	Plan	by	purchasing	group	annuity	contracts	from	the	Prudential	Insurance Company	of	America,	a	subsidiary	of	Prudential	Financial,	Inc.	("Prudential").	This

transaction	transferred	payment	responsibility	to	Prudential	for	retirement	benefits	owed	to	approximately	35,000	U.S.	retirees	and	their	beneficiaries.	As	a	result, we	recorded	a	non-cash	charge	of	$370.7	million	pre-tax.	See	"Note	4.	Retirement	Plans"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional information.

(3) In	fiscal	2017,	lump	sum	payments	to	certain	beneficiaries	of	the	Plan,	together	with	several	one-time	severance	benefit	payments	out	of	the	Plan,	triggered pension	settlement	accounting	and	a	remeasurement	of	the	Plan.	As	a	result	of	settlement	accounting,	we	recognized	as	a	current	period	expense	a	pro-rata portion	of	the	unamortized	net	actuarial	loss,	after	remeasurement,	and	recorded	a	$32.6	million	non-cash	charge	to	our	earnings.	In	fiscal	2015,	payments	were made	to	former	employees	to	partially	settle	obligations	of	one	of	our	qualified	defined	benefit	pension	plans	and	we	recorded	a	non-cash	pre-tax	charge	of	$20.0 million.	In	addition,	changes	in	retiree	medical	coverage	for	certain	employees	covered	by	the	USW	master	agreement	resulted	in	the	recognition	of	an	$8.5	million pre-tax	curtailment	gain.	These	two	items	netted	to	an	$11.5	million	pre-tax	charge.	In	fiscal	2014,	we	completed	the	first	phase	of	our	previously	announced	lump sum	pension	settlement	to	certain	eligible	former	employees	and	recorded	a	pre-tax	charge	of	$47.9	million.	See	"Note	4.	Retirement	Plans"	of	the	Notes	to Consolidated	Financial	Statements	for	additional	information.

(4) In	fiscal	2018,	we	recorded	a	$31.9	million	pre-tax	non-cash	impairment	of	certain	mineral	rights	and	real	estate.	The	$23.6	million	impairment	of	mineral	rights	was driven	by	the	non-renewal	of	a	lease,	and	the	other	$8.3	million	was	recorded	to	write-down	the	carrying	value	on	real	estate	projects.	Similarly,	in	fiscal	2017,	we recorded	 a	 pre-tax	 non-cash	 real	 estate	 impairment	 of	 $46.7	 million,	 or	 $39.7	 million	 net	 of	 $7.0	 million	 of	 noncontrolling	 interest.	 Due	 to	 the	 accelerated monetization	strategy	in	our	Land	and	Development	segment,	the	real	estate	impairments	in	both	years	were	recorded	to	write-down	the	carrying	value	on	projects where	the	projected	sales	proceeds	were	less	than	the	carrying	value.

(5) Costs	recorded	in	each	period	are	not	comparable	since	the	timing	and	scope	of	the	individual	actions	vary.	The	restructuring	and	other	costs	exclude	the	Specialty Chemicals	costs,	which	are	included	in	discontinued	operations	in	fiscal	2016.	See	"Note	3.	Restructuring	and	Other	Costs"	of	the	Notes	to	Consolidated Financial	Statements	for	additional	information	regarding	the	type	of	costs	incurred.

(6) On	April	6,	2017,	we	completed	the	HH&B	Sale.	In	fiscal	2017,	we	recorded	a	pre-tax	gain	on	sale	of	HH&B	of	$192.8	million.	See	"Note	1.	Description	of Business	and	Summary	of	Significant	Accounting	Policies	—	Description	of	Business"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional information.

(7) Income	from	continuing	operations	was	impacted	by	the	HH&B	Sale,	restructuring	and	other	costs,	the	Land	and	Development	impairment,	multiemployer	pension withdrawals,	 the	pension	 lump	sum	settlements	and	pension	risk	 transfer	as	 identified	 in	 the	 table	above	 for	 the	respective	years.	 In	addition,	 income	 from continuing	operations	in	fiscal	2018	included	an	income	tax	benefit	of	$1,128.8	million	related	to	the	Tax	Act.	See	"Note	5.	Income	Taxes	—	Impacts	of	the	Tax Act"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.	Income	from	continuing	operations	in	fiscal	2017	was	reduced	by	$26.5	million pre-tax	for	the	expensing	of	inventory	stepped-up	in	purchase	accounting,	primarily	related	to	the	MPS	Acquisition,	and	income	from	continuing	operations	in	fiscal 2015	was	reduced	by	$64.7	million	pre-tax	for	the	expensing	of	inventory	stepped-up	in	purchase	accounting,	primarily	related	to	the	Combination.	Income	from continuing	operations	in	fiscal	2015	and	2014	was	increased	as	a	result	of	a	reduction	of	cost	of	goods	sold	of	$6.7	million	and	$32.3	million	pre-tax,	respectively, due	to	the	recording	of	additional	value	of	spare	parts	at	our	containerboard	mills	acquired	in	the	May	27,	2011	acquisition	of	Smurfit-Stone,	in	a	stock	purchase (the	"Smurfit-Stone	Acquisition").

(8) Loss	from	discontinued	operations,	net	of	tax	in	fiscal	2016	included	a	$478.3	million	pre-tax	goodwill	impairment	charge	and	$101.1	million	pre-tax	customer	list impairment	charge	associated	with	our	former	Specialty	Chemicals	operations.	See	"Note	7.	Discontinued	Operations"	of	the	Notes	to	Consolidated	Financial Statements	for	additional	information.	Income	from	discontinued	operations,	net	of	tax	in	fiscal	2015	was	reduced	by	$8.2	million	pre-tax	for	the	expensing	of inventory	stepped-up	in	purchase	accounting,	net	of	related	last-in	first-out	inventory	valuation	method	("LIFO")	impact.

# Item	7. MANAGEMENT'S	DISCUSSION	AND	ANALYSIS	OF	FINANCIAL	CONDITION	AND	RESULTS	OF	OPERATIONS

# Overview

We	are	a	multinational	provider	of	paper	and	packaging	solutions	for	consumer	and	corrugated	packaging	markets.	We	partner	with	our	customers	to provide	differentiated	paper	and	packaging	solutions	that	help	them	win	in	the	marketplace.	Our	team	members	support	customers	around	the	world	from our	operating	and	business	locations	in	North	America,	South	America,	Europe,	Asia	and	Australia.	We	also	sell	real	estate	primarily	in	the	Charleston,	SC region.

# Organization

WestRock	was	formed	on	March	6,	2015	for	the	purpose	of	effecting	the	Combination	and,	prior	to	the	Combination,	did	not	conduct	any	activities other	than	those	incidental	to	its	formation	and	the	matters	contemplated	by	the	Business	Combination	Agreement.	On	July	1,	2015,	pursuant	to	the Business	Combination	Agreement,	RockTenn	and	MWV	completed	a	strategic	combination	of	their	respective	businesses	and	RockTenn	and	MWV	each became	wholly-owned	subsidiaries	of	WestRock.	RockTenn	was	the	accounting	acquirer	in	the	Combination.

On	May	15,	2016,	WestRock	completed	the	Separation,	pursuant	to	which	we	disposed	of	our	former	Specialty	Chemicals	segment	in	its	entirety	and ceased	to	consolidate	its	assets,	liabilities	and	results	of	operations	in	our	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	consolidated	 financial statements	for	all	periods	presented.	See	"Note	7.	Discontinued	Operations"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

On	April	6,	2017,	we	completed	the	HH&B	Sale.	We	used	the	proceeds	from	the	HH&B	Sale	in	connection	with	the	of	MPS	Acquisition.	We	recorded a	pre-tax	gain	on	sale	of	HH&B	of	$192.8	million	in	fiscal	2017.	See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies —	Description	of	Business"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

On	June	6,	2017,	we	completed	the	MPS	Acquisition.	MPS	is	reported	in	our	Consumer	Packaging	segment.	See	" Note	2.	Mergers,	Acquisitions and	Investment"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

On	November	2,	2018,	pursuant	to	the	Merger	Agreement,	the	Company	acquired	all	of	the	outstanding	shares	of	KapStone	through	the	Mergers.	As a	result	of	the	Mergers,	among	other	things,	the	Company	became	the	ultimate	parent	of	WRKCo,	KapStone	and	their	respective	subsidiaries.	Effective	as of	the	the	Effective	Time,	the	Company	changed	its	name	to	"WestRock	Company"	and	WRKCo	changed	its	name	to	"WRKCo	Inc.".	See	"Note	 23. Subsequent	Events	(Unaudited)"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Presentation

We	report	our	financial	results	of	operations	in	the	following	three	reportable	segments:	Corrugated	Packaging,	which	consists	of	our	containerboard mill	and	corrugated	packaging	operations,	as	well	as	our	recycling	operations;	Consumer	Packaging,	which	consists	of	consumer	mills,	folding	carton, beverage,	merchandising	displays	and	partition	operations;	and	Land	and	Development,	which	sells	real	estate,	primarily	in	the	Charleston,	SC	region. Following	 the	 Combination	 and	 until	 the	 completion	 of	 the	 Separation,	 our	 financial	 results	 of	 operations	 had	 a	 fourth	 reportable	 segment,	 Specialty Chemicals.	Prior	to	the	HH&B	Sale,	our	Consumer	Packaging	segment	included	HH&B.

In	fiscal	2019,	we	plan	to	operate	our	recycling	operations	primarily	as	a	procurement	function,	shifting	its	focus	to	the	procurement	of	low	cost,	high quality	fiber	for	our	mill	system.	As	a	result,	we	will	no	longer	record	recycling	sales.

# Acquisitions	and	Investments

We	completed	a	number	of	acquisitions	 in	 the	 last	 three	years	 that	expanded	our	product	and	geographic	scope	or	allowed	us	 to	 increase	our integration	levels,	and	we	expect	to	continue	to	evaluate	similar	potential	acquisitions	in	the	future.	Below	we	summarize	certain	of	these	acquisitions	and investments.

On	September	4,	2018,	we	completed	the	Schlüter	Acquisition.	Schlüter	is	a	leading	provider	of	differentiated	paper	and	packaging	solutions	and	a German-based	supplier	of	a	full	range	of	leaflets	and	booklets.	The	Schlüter	Acquisition	allows	us	to	further	enhance	our	pharmaceutical	and	automotive platform	and	expand	our	geographical	footprint	in	Europe	to	better	serve	our	customers.	We	have	included	the	financial	results	of	the	acquired	operations	in our	Consumer	Packaging	segment	since	the	date	of	the	acquisition.

On	January	5,	2018,	we	completed	the	Plymouth	Packaging	Acquisition. 	The	assets	we	acquired	included	Plymouth's	"Box	on	Demand"	systems, which	are	manufactured	by	Panotec,	an	 Italian	manufacturer	of	packaging	machines.	The	Box	on	Demand	systems	enhance	our	platform	and	drive differentiation	and	innovation.	These	systems,	which	are	located	on	customers'	sites	under	multi-year	exclusive	agreements,	use	fanfold	corrugated	to produce	 custom,	 on-demand	 corrugated	 packaging	 that	 is	 accurately	 sized	 for	 any	 product	 type	 according	 to	 the	 customer's	 specifications.	 Fanfold corrugated	 is	 continuous	 corrugated	 board,	 folded	 periodically	 to	 form	 an	 accordion-like	 stack	 of	 corrugated	 material.	 As	 part	 of	 the transaction,	WestRock	acquired	Plymouth's	equity	interest	in	Panotec	and	Plymouth's	exclusive	right	from	Panotec	to	distribute	Panotec's	equipment	in	the U.S.	and	Canada.	We	have	fully	integrated	the	approximately	60,000	tons	of	containerboard	used	by	Plymouth	annually.	We	have	included	the	financial results	of	Plymouth	in	our	Corrugated	Packaging	segment	since	the	date	of	the	acquisition.

On	August	1,	2017,	we	completed	the	Hannapak	Acquisition.	Hanna	Group	is	one	of	Australia's	leading	providers	of	folding	cartons	to	a	variety	of markets,	including	beverage,	food,	confectionery	and	healthcare.	We	expect	this	acquisition	will	build	on	our	established	and	growing	packaging	business	in the	region.	We	have	included	the	financial	results	of	the	acquired	operations	in	our	Consumer	Packaging	segment	since	the	date	of	the	acquisition.

On	 July	 17,	 2017,	 we	 completed	 the	 Island	 Container	 Acquisition.	 The	 assets	 we	 acquired	 included	 a	 corrugator	 and	 corrugated	 converting operations.	We	have	substantially	completed	the	integration	of	the	80,000	tons	of	containerboard	used	by	Island	annually	into	our	Corrugated	Packaging segment.	We	have	included	the	financial	results	of	the	acquired	operations	in	our	Corrugated	Packaging	segment	since	the	date	of	the	acquisition.

On	June	9,	2017,	we	completed	the	U.S.	Corrugated	Acquisition.	The	acquired	business	provides	a	comprehensive	suite	of	products	and	services	to customers	in	a	variety	of	end	markets,	including	food	&	beverage,	pharmaceuticals	and	consumer	electronics.	At	the	time	of	the	transaction,	we	expected the	acquisition	to	provide	us	the	opportunity	to	increase	the	vertical	integration	of	our	Corrugated	Packaging	segment	by	approximately	105,000	tons	of containerboard	annually	through	the	acquired	facilities	and	another	50,000	tons	under	a	long-term	supply	contract	with	another	company	owned	by	the seller,	and	we	have	since	completed	the	integration	of	these	tons.	We	have	included	the	financial	results	of	U.S.	Corrugated	in	our	Corrugated	Packaging segment	since	the	date	of	the	acquisition.

On	June	6,	2017,	we	completed	the	MPS	Acquisition.	MPS	is	a	global	provider	of	print-based	specialty	packaging	solutions	and	its	differentiated product	offering	includes	premium	folding	cartons,	inserts,	labels	and	rigid	packaging.	At	the	time	of	the	transaction,	we	expected	the	acquisition	to	increase our	annual	paperboard	consumption	by	approximately	225,000	tons.	We	are	well	underway,	and	we	currently	expect	approximately	100,000	tons	to	be supplied	by	us	by	the	first	half	of	fiscal	2019.	We	have	included	the	financial	results	of	MPS	in	our	Consumer	Packaging	segment	since	the	date	of	the acquisition.

On	March	13,	2017,	we	completed	the	Star	Pizza	Acquisition.	The	transaction	provided	us	with	a	leadership	position	in	the	fast	growing	small-run pizza	box	market	and	increased	our	vertical	integration.	We	have	fully	integrated	the	approximately	22,000	tons	of	containerboard	used	by	Star	Pizza annually.	We	have	included	the	financial	results	of	the	acquired	operations	in	our	Corrugated	Packaging	segment	since	the	date	of	the	acquisition.

On	April	1,	2016,	we	completed	the	formation	of	a	joint	venture	with	Grupo	Gondi	to	combine	our	respective	operations	in	Mexico.	We	contributed cash	and	the	stock	of	an	entity	that	owns	three	corrugated	packaging	facilities	in	Mexico	in	return	for	a	25.0%	ownership	interest	in	the	joint	venture together	with	future	put	and	call	rights.	In	April	2017,	the	joint	venture	entity	had	a	stock	redemption	from	a	minority	partner	which	increased	our	ownership interest	 to	 approximately	 27.0%.	 On	 October	 20,	 2017,	 we	 increased	 our	 ownership	 interest	 to	 approximately	 32.3%	 through	 a	 $108	 million	 capital contribution.	The	joint	venture	operates	paper	machines,	corrugated	packaging	and	high	graphic	folding	carton	facilities	across	various	production	sites. The	majority	equity	holders	of	Grupo	Gondi

manage	the	joint	venture	and	we	provide	technical	and	commercial	resources.	We	believe	the	joint	venture	is	helping	us	to	grow	our	presence	in	the attractive	Mexican	market.	We	have	included	the	financial	results	of	the	joint	venture	in	our	Corrugated	Packaging	segment	since	the	date	of	formation.	We are	accounting	for	the	investment	on	the	equity	method.

On	January	19,	2016,	we	completed	the	Packaging	Acquisition.	The	entities	acquired	provide	value-added	folding	carton	and	litho-laminated	display packaging	solutions.	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	in	our	Consumer	Packaging	segment	since	the	date	of	the	acquisition.

On	October	1,	2015,	we	completed	the	SP	Fiber	Acquisition.	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%	interest	in	Green	Power	Solutions	of	Georgia,	LLC	("GPS"),	which	we	consolidate.	GPS	is	a	joint	venture	providing	steam	to	the Dublin	mill	and	electricity	to	Georgia	Power.	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	have	included	the	financial results	of	the	acquired	entities	in	our	Corrugated	Packaging	segment	since	the	date	of	the	acquisition.

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales | $16,285.1 | $14,859.7 | $14,171.8 |
| Segment\tincome | $1,685.0 | $1,193.5 | $1,226.2 |

In	 fiscal	 2018,	 we	 continued	 to	 pursue	 our	 strategy	 of	 offering	 differentiated	 paper	 and	 packaging	 solutions	 that	 help	 our	 customers	 win.	 We successfully	executed	this	strategy	in	fiscal	2018	in	a	rapidly	changing	cost	and	price	environment.	Net	sales	of	$16,285.1	million	for	fiscal	2018	increased $1,425.4	million,	or	9.6%,	compared	to	fiscal	2017.	The	increase	was	primarily	a	result	of	an	increase	in	Corrugated	Packaging	segment	sales,	driven	by higher	selling	price/mix	and	the	contributions	from	acquisitions,	and	increased	Consumer	Packaging	segment	sales,	primarily	due	to	the	contribution	from acquisitions	(primarily	the	MPS	Acquisition).	These	increases	were	partially	offset	by	the	absence	of	net	sales	from	HH&B	in	fiscal	2018	due	to	the	sale	of HH&B	in	April	2017	and	lower	Land	and	Development	segment	sales	compared	to	the	prior	year	period	due	to	the	timing	of	real	estate	sales	as	we monetize	the	portfolio	and	lower	merchandising	display	sales	in	the	Consumer	Packaging	segment.	Segment	income	increased	$491.5	million	in	fiscal	2018 compared	to	fiscal	2017,	primarily	due	to	increased	Corrugated	Packaging	segment	income.	With	respect	to	segment	income,	we	experienced	higher	levels of	cost	inflation	during	fiscal	2018	as	compared	to	fiscal	2017,	which	was	partially	offset	by	recycled	fiber	deflation.	The	primary	inflationary	items	were freight	costs,	chemical	costs,	virgin	fiber	costs	and	wage	and	other	costs.	Productivity	improvements	in	fiscal	2018	more	than	offset	the	net	impact	of	cost inflation.	While	it	is	difficult	to	predict	specific	inflationary	items,	we	expect	higher	cost	inflation	to	continue	through	fiscal	2019.

Our	Corrugated	Packaging	segment	increased	its	net	sales	by	$695.1	million	in	fiscal	2018	to	$9,103.4	million	from	$8,408.3	million	in	fiscal	2017.	The increase	in	net	sales	was	primarily	due	to	higher	corrugated	selling	price/mix	and	higher	corrugated	volumes	(including	acquisitions),	which	were	partially offset	by	lower	net	sales	from	recycling	operations	due	to	lower	recycled	fiber	costs,	lower	sales	related	to	the	deconsolidation	of	a	foreign	joint	venture	in fiscal	2017	and	the	impact	of	foreign	currency.	North	American	box	shipments	increased	4.1%	on	a	per	day	basis	in	fiscal	2018	compared	to	fiscal	2017. Segment	income	attributable	to	the	Corrugated	Packaging	segment	in	fiscal	2018	increased	$454.0	million	to	$1,207.9	million	compared	to	$753.9	million	in fiscal	2017.	The	increase	was	primarily	due	to	higher	selling	price/mix,	lower	recycled	fiber	costs	and	productivity	improvements	which	were	partially	offset by	higher	levels	of	cost	inflation	and	other	items,	including	increased	depreciation	and	amortization.

Our	Consumer	Packaging	segment	increased	its	net	sales	by	$838.9	million	in	fiscal	2018	to	$7,291.4	million	from	$6,452.5	million	in	fiscal	2017.	The increase	in	net	sales	was	primarily	due	to	an	increase	in	net	sales	from	acquisitions	(primarily	the	MPS	Acquisition)	and	higher	selling	price/mix	partially offset	by	the	absence	of	net	sales	from	HH&B	in	fiscal	2018	due	to	the	HH&B	Sale	in	April	2017	and	lower	volumes.	Segment	income	attributable	to

the	Consumer	Packaging	segment	in	fiscal	2018	increased	$28.8	million	to	$454.6	million	compared	to	$425.8	million	in	fiscal	2017,	primarily	as	a	result	of productivity	improvements,	lower	depreciation	and	amortization	(excluding	the	MPS	Acquisition),	higher	selling	price/mix	and	income	from	acquisitions, which	were	partially	offset	by	cost	inflation	and	other	items,	the	absence	of	income	from	HH&B	in	fiscal	2018	due	to	the	HH&B	Sale	in	April	2017	and	lower volumes.	Consumer	Packaging's	segment	income	in	fiscal	2017	included	a	$25.1	million	acquisition	inventory	step-up	charge	related	primarily	to	the	MPS Acquisition.

Our	Land	and	Development	segment	sales	were	$142.4	million	in	fiscal	2018	compared	to	$243.8	million	in	fiscal	2017,	primarily	due	to	the	timing	of land	sales	associated	with	our	accelerated	monetization.	We	expect	to	complete	the	monetization	of	our	portfolio	during	fiscal	2019.	After	we	complete	the monetization,	 the	 segment	 will	 cease	 to	 exist.	 Segment	 income	 attributable	 to	 the	 Land	 and	 Development	 segment	 was	 $22.5	 million	 in	 fiscal	 2018 compared	to	$13.8	million	in	fiscal	2017.

We	generated	$2,420.9	million	of	net	cash	provided	by	operating	activities	in	fiscal	2018,	compared	to	$1,900.5	million	in	fiscal	2017.	We	remained committed	to	our	disciplined	capital	allocation	strategy	during	fiscal	2018	by	investing	$999.9	million	in	capital	expenditures,	deployed	$347.9	million	to strategic	acquisitions	and	investments	while	returning	$440.9	million	in	dividends	and	$195.1	million	to	our	stockholders	in	share	repurchases.	We	believe our	strong	balance	sheet	and	cash	flow	provide	us	the	flexibility	to	continue	to	invest	to	sustain	and	improve	our	operating	performance.	In	fiscal	2019,	we expect	capital	expenditures	to	be	approximately	$1.5	billion,	including	KapStone.	See	"Liquidity	and	Capital	Resources"	for	more	information.

# A	detailed	review	of	our	fiscal	2018	performance	appears	below	under	" Results	of	Operations	(Consolidated)"	and	"Results	of	Operations	— Segment	Data".

# Results	of	Operations	(Consolidated)

The	following	table	summarizes	our	consolidated	results	for	the	three	years	ended	September	30,	2018:

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales | $16,285.1 | $14,859.7 | $14,171.8 |
| Cost\tof\tgoods\tsold | 12,891.2 | 12,119.5 | 11,413.2 |
| Selling,\tgeneral\tand\tadministrative,\texcluding\tintangible |  |  |  |
| \t\t\tamortization | 1,493.3 | 1,399.6 | 1,379.4 |
| Selling,\tgeneral\tand\tadministrative\tintangible\tamortization | 296.6 | 229.6 | 211.8 |
| Multiemployer\tpension\twithdrawals | 184.2 | — | — |
| Pension\trisk\ttransfer\texpense | — | — | 370.7 |
| Pension\tlump\tsum\tsettlement | — | 32.6 | — |
| Land\tand\tDevelopment\timpairments | 31.9 | 46.7 | — |
| Restructuring\tand\tother\tcosts | 105.4 | 196.7 | 366.4 |
| Operating\tprofit | 1,282.5 | 835.0 | 430.3 |
| Interest\texpense,\tnet | (293.8) | (222.5) | (212.5) |
| Gain\ton\textinguishment\tof\tdebt | (0.1) | 1.8 | 2.7 |
| Other\tincome,\tnet | 12.7 | 11.5 | 14.4 |
| Equity\tin\tincome\tof\tunconsolidated\tentities | 33.5 | 39.0 | 9.7 |
| Gain\ton\tsale\tof\tHH&amp;B | — | 192.8 | — |
| Income\tfrom\tcontinuing\toperations\tbefore\tincome\ttaxes | 1,034.8 | 857.6 | 244.6 |
| Income\ttax\tbenefit\t(expense) | 874.5 | (159.0) | (89.8) |
| Income\tfrom\tcontinuing\toperations | 1,909.3 | 698.6 | 154.8 |
| Loss\tfrom\tdiscontinued\toperations\t(net\tof\tincome |  |  |  |
| \t\t\ttax\tbenefit\tof\t$0,\t$0\tand\t$32.3) | — | — | (544.7) |
| Consolidated\tnet\tincome\t(loss) | 1,909.3 | 698.6 | (389.9) |
| Less:\tNet\t(income)\tloss\tattributable\tto\tnoncontrolling\tinterests | (3.2) | 9.6 | (6.4) |
| Net\tincome\t(loss)\tattributable\tto\tcommon\tstockholders | $1,906.1 | $708.2 | $(396.3) |

# Non-GAAP	Measures

We	report	our	financial	results	in	accordance	with	generally	accepted	accounting	principles	in	the	U.S.	(" GAAP").	However,	we	have	included	financial measures	that	were	not	prepared	in	accordance	with	GAAP.	Non-GAAP	financial	measures	should	be	viewed	in	addition	to,	and	not	as	an	alternative	for, our	GAAP	results.	The	non-GAAP	financial	measures	we	present	may	differ	from	similarly	captioned	measures	of	other	companies.

We	use	the	non-GAAP	financial	measures	"Adjusted	Income	from	Continuing	Operations"	and	"Adjusted	Earnings	from	Continuing	Operations	Per Diluted	Share".	Management	believes	these	non-GAAP	financial	measures	provide	our	board	of	directors,	investors,	potential	investors,	securities	analysts and	others	with	useful	information	to	evaluate	our	performance	because	the	measures	exclude	restructuring	and	other	costs,	and	other	specific	items	that management	believes	are	not	indicative	of	ongoing	operating	results.	We	and	our	board	of	directors	use	this	information	to	evaluate	our	performance relative	to	other	periods.	We	believe	that	the	most	directly	comparable	GAAP	measures	to	Adjusted	Income	from	Continuing	Operations	and	Adjusted Earnings	from	Continuing	Operations	Per	Diluted	Share	are	Income	from	continuing	operations	and	Earnings	from	continuing	operations	per	diluted	share, respectively.	The	GAAP	results	in	the	tables	that	follow	for	Pre-Tax,	Tax	and	Net	of	Tax	are	equivalent	to	the	line	items	"Income	from	continuing	operations before	income	taxes",	"Income	tax	benefit	(expense)"	and	"Income	from	continuing	operations",	respectively,	as	reported	on	the	Consolidated	Statements	of Operations.

Set	forth	below	is	a	reconciliation	of	the	non-GAAP	financial	measure	Adjusted	Earnings	from	Continuing	Operations	Per	Diluted	Share	to	Earnings from	continuing	operations	per	diluted	share,	the	most	directly	comparable	GAAP	measure	(in	dollars	per	share)	for	the	periods	indicated.

|  | Years	Ended	September	30, | Years	Ended	September	30, |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Earnings\tfrom\tcontinuing\toperations\tper\tdiluted\tshare | $7.34 | $2.77 | $0.59 |
| Impact\tof\tTax\tAct,\tnet\tof\trelated\ttax\tplanning | (4.22) | — | — |
| Multiemployer\tpension\twithdrawals | 0.52 | — | — |
| Restructuring\tand\tother\titems | 0.30 | 0.52 | 0.97 |
| Accelerated\tdepreciation\ton\tmajor\tcapital\tprojects | 0.08 | — | — |
| Consumer\tPackaging\tsegment\tacquisition\treserve\tadjustments | (0.06) | — | — |
| Acquisition\tbridge\tand\tother\tfinancing\tfees | 0.03 | — | — |
| Gain\ton\tsale\tof\twaste\tservices | (0.03) | — | — |
| Land\tand\tDevelopment\toperating\tresults\tincluding\timpairments | 0.02 | 0.06 | (0.01) |
| Losses\tat\tclosed\tplants\tand\ttransition\tcosts | 0.06 | 0.05 | 0.07 |
| Gain\ton\tsale\tof\tHH&amp;B | — | (0.76) | — |
| HH&amp;B\t-\timpact\tof\theld\tfor\tsale\taccounting | — | (0.03) | — |
| Pension\tlump\tsum\tsettlement | — | 0.08 | — |
| Inventory\tstepped-up\tin\tpurchase\taccounting,\tnet\tof\tLIFO | — | 0.08 | 0.02 |
| Gain\ton\tsale\tor\tdeconsolidation\tof\tsubsidiaries | — | (0.01) | — |
| Federal,\tstate\tand\tforeign\ttax\titems | — | (0.16) | — |
| Gain\ton\textinguishment\tof\tdebt | — | — | (0.01) |
| Non-cash\tpension\trisk\ttransfer\texpense | — | — | 0.89 |
| Gain\ton\tinvestment\tin\tGrupo\tGondi | — | — | (0.01) |
| Other | 0.05 | 0.02 | 0.01 |
| Adjusted\tEarnings\tfrom\tContinuing\tOperations\tPer\tDiluted\n\t\t\tShare | $4.09 | $2.62 | $2.52 |

The	GAAP	results	in	the	tables	below	for	Pre-Tax,	Tax	and	Net	of	Tax	are	equivalent	to	the	line	items	"Income	from	continuing	operations	before income	 taxes",	"Income	 tax	benefit	(expense)"	and	"Income	 from	continuing	operations",	respectively,	as	reported	on	 the	Consolidated	Statements	of Operations.	Set	forth	below	are	reconciliations	of	Adjusted	Income	from	Continuing	Operations	to	the	most	directly	comparable	GAAP	measure,	Income from	continuing	operations,	for	the	periods	indicated	(in	millions):

|  | Year	ended	September	30,	2018 | Year	ended	September	30,	2018 |  |
| :--- | :--- | :--- | :--- |
|  | Pre-Tax | Tax | Net\tof\tTax |
| GAAP\tResults,\tfrom\tcontinuing\toperations | $1,034.8 | $874.5 | $1,909.3 |
| Impact\tof\tTax\tAct,\tnet\tof\trelated\ttax\tplanning | — | (1,096.9) | (1,096.9) |
| Multiemployer\tpension\twithdrawals | 183.3 | (47.7) | 135.6 |
| Restructuring\tand\tother\titems | 105.4 | (26.3) | 79.1 |
| Inventory\tstepped-up\tin\tpurchase\taccounting,\tnet\tof\tLIFO | 1.0 | (0.3) | 0.7 |
| Land\tand\tDevelopment\toperating\tresults\tincluding\timpairments | 6.9 | (1.6) | 5.3 |
| Losses\tat\tclosed\tplants\tand\ttransition\tcosts | 19.4 | (5.0) | 14.4 |
| Accelerated\tdepreciation\ton\tmajor\tcapital\tprojects | 27.0 | (7.4) | 19.6 |
| Loss\ton\textinguishment\tof\tdebt | 0.1 | — | 0.1 |
| Consumer\tPackaging\tsegment\tacquisition\treserve\tadjustments | (20.1) | 5.2 | (14.9) |
| Acquisition\tbridge\tand\tother\tfinancing\tfees | 12.0 | (3.1) | 8.9 |
| Gain\ton\tsale\tof\twaste\tservices | (12.3) | 4.4 | (7.9) |
| Other | 13.7 | (1.9) | 11.8 |
| Adjusted\tIncome\tfrom\tContinuing\tOperations | $1,371.2 | $(306.1) | $1,065.1 |
| Noncontrolling\tinterest\tfrom\tcontinuing\toperations |  |  | (3.2) |
| Adjusted\tnet\tincome\tattributable\tto\tcommon\tstockholders |  |  | $1,061.9 |

|  | Year	ended	September	30,	2017 | Year	ended	September	30,	2017 |  |
| :--- | :--- | :--- | :--- |
|  | Pre-Tax | Tax | Net\tof\tTax |
| GAAP\tResults,\tfrom\tcontinuing\toperations | $857.6 | $(159.0) | $698.6 |
| Gain\ton\tsale\tof\tHH&amp;B\t(1) | (192.8) | — | (192.8) |
| HH&amp;B\t-\timpact\tof\theld\tfor\tsale\taccounting | (10.1) | 2.3 | (7.8) |
| Restructuring\tand\tother\titems | 196.7 | (62.8) | 133.9 |
| Pension\tlump\tsum\tsettlement | 32.6 | (12.6) | 20.0 |
| Inventory\tstepped-up\tin\tpurchase\taccounting,\tnet\tof\tLIFO | 26.5 | (7.0) | 19.5 |
| Land\tand\tDevelopment\toperating\tresults\tincluding\timpairments | 26.7 | (10.6) | 16.1 |
| Losses\tat\tclosed\tplants\tand\ttransition\tcosts | 18.2 | (5.8) | 12.4 |
| Gain\ton\tsale\tor\tdeconsolidation\tof\tsubsidiaries | (5.0) | 2.4 | (2.6) |
| Federal,\tstate\tand\tforeign\ttax\titems | — | (40.5) | (40.5) |
| Gain\ton\textinguishment\tof\tdebt | (1.8) | 0.6 | (1.2) |
| Other | 8.1 | (2.7) | 5.4 |
| Adjusted\tIncome\tfrom\tContinuing\tOperations | $956.7 | $(295.7) | $661.0 |
| Noncontrolling\tinterest\tfrom\tcontinuing\toperations |  |  | 9.6 |
| Adjusted\tnet\tincome\tattributable\tto\tcommon\tstockholders |  |  | $670.6 |

(1) Essentially	no	tax	was	incurred	due	to	a	high	tax	basis	and	fees	associated	with	the	transaction

|  |  | Year	ended	September	30,	2016 |  |
| :--- | :--- | :--- | :--- |
|  | Pre-Tax | Tax | Net\tof\tTax |
| GAAP\tResults,\tfrom\tcontinuing\toperations | $244.6 | $(89.8) | $154.8 |
| Restructuring\tand\tother\titems | 366.4 | (116.0) | 250.4 |
| Inventory\tstepped-up\tin\tpurchase\taccounting,\tnet\tof\tLIFO | 8.1 | (2.5) | 5.6 |
| Land\tand\tDevelopment\toperating\tresults\tincluding\timpairment | (5.6) | 2.2 | (3.4) |
| Losses\tat\tclosed\tplants\tand\ttransition\tcosts | 23.3 | (6.6) | 16.7 |
| Gain\ton\textinguishment\tof\tdebt | (2.7) | 0.8 | (1.9) |
| Non-cash\tpension\trisk\ttransfer\texpense | 370.7 | (140.9) | 229.8 |
| Gain\ton\tinvestment\tin\tGrupo\tGondi\t(1) | (12.1) | 10.6 | (1.5) |
| Other | 1.8 | (0.6) | 1.2 |
| Adjusted\tIncome\tfrom\tContinuing\tOperations | $994.5 | $(342.8) | $651.7 |
| Noncontrolling\tinterest\tfrom\tcontinuing\toperations |  |  | (2.1) |
| Adjusted\tnet\tincome\tattributable\tto\tcommon\tstockholders |  |  | $649.6 |

(1) Impacted	by	non-deductible	goodwill

# We	discuss	certain	of	these	charges	in	more	detail	in	" Note	3.	Restructuring	and	Other	Costs"	and	"Note	4.	Retirement	Plans",	"Note	5.	Income Taxes"	and	See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies	—	Description	of	Business ".

# Net	Sales	(Unaffiliated	Customers)

Net	sales	in	fiscal	2018	increased	$1,425.4	million,	or	9.6%,	compared	to	fiscal	2017.	The	increase	was	primarily	attributable	to	increased	Corrugated Packaging	 segment	 sales,	 driven	 by	 higher	 selling	 price/mix	 and	 contributions	 from	 acquisitions	 and	 increased	 Consumer	 Packaging	 segment	 sales, primarily	due	to	the	contribution	from	acquisitions	(primarily	the	MPS	Acquisition).	These	increases	in	segment	sales	were	partially	offset	by	the	absence	of net	sales	from	HH&B	in	fiscal	2018	due	to	the	sale	of	HH&B	in	April	2017.	In	addition,	Land	and	Development	segment	sales	were	lower	compared	to	the prior	year	period	due	to	the	timing	of	real	estate	sales	as	we	monetize	the	portfolio	and	lower	merchandising	display	sales	in	the	Consumer	Packaging segment.

Net	sales	for	fiscal	2017	increased	$687.9	million	to	$14,859.7	million	compared	to	$14,171.8	million	in	fiscal	2016.	The	increase	was	primarily	a	result of	an	increase	in	Corrugated	Packaging	segment	sales,	including	the	partial	period	impact	of	the	U.S.	Corrugated	Acquisition	and	the	Island	Container Acquisition,	an	increase	in	Land	and	Development	segment	sales	due	to	the	accelerated	monetization	and	a	net	increase	in	Consumer	Packaging	segment sales	associated	with	the	MPS	Acquisition	and	the	Hannapak	Acquisition,	partially	offset	by	factors	that	included	the	absence	of	full	year	net	sales	from HH&B	in	fiscal	2017	due	to	the	sale	of	HH&B.

The	change	in	net	sales	by	segment	is	outlined	in	the	" Results	of	Operations	—	Segment	Data"	section	below.

# Cost	of	Goods	Sold

Cost	of	goods	sold	increased	to	$12,891.2	million	in	fiscal	2018	compared	to	$12,119.5	million	in	fiscal	2017.	Cost	of	goods	sold	as	a	percentage	of	net sales	was	79.2%	in	fiscal	2018	compared	to	81.6%	in	fiscal	2017.	The	increase	in	cost	of	goods	sold	in	fiscal	2018	compared	to	fiscal	2017	was	primarily due	 to	 increased	net	sales	associated	with	 the	 impact	of	acquisitions	(primarily	 the	MPS	Acquisition)	and	higher	 levels	of	cost	 inflation.	The	primary inflationary	items	were	freight	costs,	chemical	costs,	virgin	fiber	costs	and	wage	and	other	costs.	These	factors	were	partially	offset	by	the	absence	of	costs associated	with	HH&B	in	fiscal	2018	due	to	the	HH&B	Sale,	productivity	improvements,	lower	recycled	fiber	costs	and	decreased	land	sales.	Cost	of	goods sold	as	a	percentage	of	net	sales	also	decreased	as	a	result	of	higher	selling	prices,	primarily	in	our	Corrugated	Packaging	segment.	Fiscal	2018	and	2017 included	$1.0	million	and	$26.5	million,	respectively,	for	the	expensing	of	inventory	stepped-up	in	purchase	accounting,	net	of	related	LIFO	impact.

Cost	of	goods	sold	increased	to	$12,119.5	million	in	fiscal	2017	compared	to	$11,413.2	million	in	fiscal	2016.	Cost	of	goods	sold	as	a	percentage	of	net sales	was	81.6%	in	fiscal	2017	compared	to	80.5%	in	fiscal	2016	primarily	due	to	cost	inflation,	primarily	recycled	fiber,	as	well	as	increased	land	sales	due to	the	accelerated	monetization	and	the	net	impact	of	acquisitions	offset	by	the	impact	of	the	HH&B	Sale	and	other	items.	In	addition,	fiscal	2017	compared to	fiscal	2016	was	negatively	impacted	by	the	several	hurricanes.	These	factors	were	partially	offset	by	synergy	and	productivity	improvements.	Fiscal	2017 and	2016	included	$26.5	million	and	$8.1	million	for	the	expensing	of	inventory	stepped-up	in	purchase	accounting,	net	of	related	LIFO	impact,	respectively.

We	discuss	these	items	in	greater	detail	below	in	 "Results	of	Operations	—	Segment	Data".

# Selling,	General	and	Administrative	Excluding	Intangible	Amortization

Selling,	general,	and	administrative	expenses	(" SG&A")	excluding	intangible	amortization	increased	$93.7	million	to	$1,493.3	million	in	fiscal	2018 compared	to	fiscal	2017.	This	increase	was	primarily	due	to	acquisitions	completed	in	fiscal	2017	and	2018	that	were	partially	offset	by	the	impact	of	the HH&B	Sale.	SG&A	as	a	percentage	of	sales	declined	in	fiscal	2018	to	9.2%	from	9.4%	in	fiscal	2017,	in	part,	due	to	higher	selling	prices.

SG&A	excluding	intangible	amortization	increased	$20.2	million	to	$1,399.6	million	in	fiscal	2017	compared	to	$1,379.4	million	in	fiscal	2016,	due primarily	to	acquisitions.	SG&A	excluding	intangible	amortization	as	a	percentage	of	sales	decreased	to	9.4%	in	fiscal	2017	compared	to	9.7%	in	fiscal	2016.

# Selling,	General	and	Administrative	Intangible	Amortization

SG&A	intangible	amortization	was	$296.6	million,	$229.6	million	and	$211.8	million	in	fiscal	2018,	2017	and	2016,	respectively.	The	increase	in	fiscal 2018	compared	 to	 fiscal	2017	was	due	 to	acquisitions	completed	 in	 fiscal	2018	and	2017,	notably	 the	MPS	Acquisition.	The	 increase	 in	 fiscal	2017 compared	to	fiscal	2016	was	due	to	acquisitions	completed	in	fiscal	2017,	as	well	as	the	full	year	impact	of	the	Packaging	Acquisition	compared	to	nine months	of	impact	in	fiscal	2016,	which	were	partially	offset	by	the	impact	of	the	HH&B	Sale.

# Multiemployer	Pension	Withdrawals

In	fiscal	2018,	we	submitted	formal	notification	to	withdraw	from	PIUMPF	and	Central	States	and	recorded	aggregate	estimated	withdrawal	liabilities	of $184.2	million,	which	includes	an	estimate	of	our	portion	of	PIUMPF's	accumulated	funding	deficiency.	Since	these	withdrawal	liabilities	assume	payment over	20	years,	the	liabilities	were	discounted	at	a	credit	adjusted	risk-free	rate	and	therefore	we	will	accrete	the	liability	over	time	with	a	charge	to	interest expense.	See	"Note	4.	Retirement	Plans	—	Multiemployer	Plans "	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information. 	See	also Item	1A.	"Risk	Factors	—	We	May	Incur	Withdrawal	Liability	and/or	Increased	Funding	Requirements	in	Connection	with	the	MEPPs	in	Which	We Participate".

# Pension	Risk	Transfer	Expense

In	fiscal	2016,	we	used	plan	assets	to	settle	$2.5	billion	of	pension	obligations	of	the	Plan	by	purchasing	group	annuity	contracts	from	Prudential.	This transaction	transferred	payment	responsibility	to	Prudential	for	retirement	benefits	owed	to	approximately	35,000	U.S.	retirees	and	their	beneficiaries.	As	a result,	we	recorded	a	non-cash	charge	of	$370.7	million	pre-tax.	The	settlement	reduced	our	overall	U.S.	pension	obligations	and	assets	by	approximately 40%.	The	monthly	retirement	benefit	payment	amounts	currently	received	by	retirees	and	their	beneficiaries	did	not	change	as	a	result	of	this	transaction. Those	plan	participants	not	included	in	the	transaction	remain	in	the	Plan,	and	responsibility	for	payment	of	their	retirement	benefits	remains	with	us.	See "Note	4.	Retirement	Plans"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Pension	Lump	Sum	Settlement	Expense

In	fiscal	2017,	lump	sum	payments	to	certain	beneficiaries	of	the	Plan,	together	with	several	one-time	severance	benefit	payments	out	of	the	Plan, triggered	pension	settlement	accounting	and	resulted	in	a	$32.6	million	non-cash	charge	to	our	earnings.	The	lump	sum	payments	were	to	certain	eligible former	employees	who	were	not	currently	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.	See	"Note	4.	Retirement	Plans"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Land	and	Development	Impairments

In	fiscal	2018,	we	recorded	$31.9	million	of	pre-tax	non-cash	impairments	of	certain	mineral	rights	and	real	estate.	The	$23.6	million	impairment	of mineral	rights	was	driven	by	the	non-renewal	of	a	lease,	and	the	other	$8.3	million	was	recorded	to	write-down	the	carrying	value	on	real	estate	projects. Similarly,	in	fiscal	2017,	we	recorded	a	pre-tax	non-cash	real	estate	impairment	of	$46.7	million,	or	$39.7	million	net	of	$7.0	million	of	noncontrolling	interest. Due	to	the	accelerated	monetization	in	our	Land	and	Development	segment,	the	real	estate	impairments	in	both	years	were	recorded	to	write-down	the carrying	value	on	projects	where	the	projected	sales	proceeds	were	less	than	the	carrying	value.	The	charge	is	not	reflected	in	segment	income.

# Restructuring	and	Other	Costs

We	recorded	aggregate	pre-tax	restructuring	and	other	costs	of	$105.4	million,	$196.7	million	and	$366.4	million	for	fiscal	2018,	2017	and	2016, respectively.	We	generally	expect	the	integration	of	a	closed	facility's	assets	and	production	with	other	facilities	to	enable	the	receiving	facilities	to	better leverage	their	fixed	costs	while	eliminating	fixed	costs	from	the	closed	facility.	Costs	recorded	in	each	period	are	not	comparable	since	the	timing	and	scope of	 the	 individual	 actions	 associated	 with	 each	 restructuring,	 acquisition,	 divestiture	 or	 integration	 vary.	The	 restructuring	 and	 other	 costs	 exclude	 the Specialty	Chemicals	costs,	which	are	included	in	discontinued	operations	in	fiscal	2016.	See	"Note	3.	Restructuring	and	Other	Costs"	and	"Note	7. Discontinued	Operations"	 of the	 Notes	 to	 Consolidated	 Financial	 Statements	 for	 additional	 information,	 including	 a	 description	 of	 the	 type	 of	 costs incurred.	We	have	restructured	portions	of	our	operations	from	time	to	time	and	it	is	possible	that	we	may	engage	in	additional	restructuring	opportunities	in the	 future.	 See	 also Item	 1A.	"Risk	 Factors	 —	 We	 May Incur	 Additional	 Restructuring	 Costs	 and	 May	 Not	 Realize	 Expected	 Benefits from Restructuring".

# Interest	Expense,	net

Interest	expense,	net	was	$293.8	million,	$222.5	million	and	$212.5	million	for	fiscal	2018,	2017	and	2016,	respectively.	Interest	expense,	net	in	fiscal 2018	increased	primarily	due	to	debt	incurred	as	a	result	of	acquisitions	in	fiscal	2017	and	2018,	as	well	as	an	increase	in	market	interest	rates.	The increase	in	fiscal	2017	as	compared	to	fiscal	2016	was	primarily	due	to	debt	incurred	as	a	result	of	acquisitions.	Interest	expense,	net	in	fiscal	2018,	2017 and	2016	was	reduced	by	$31.0	million,	$34.5	million	and	$44.5	million,	respectively,	related	to	the	amortization	of	the	fair	value	of	debt	stepped-up	in purchase	accounting.	During	fiscal	2018,	2017	and	2016	amortization	of	debt	issuance	costs	charged	to	interest	expense,	net	were	$6.3	million,	$4.5	million and	$4.6	million,	respectively.	See	Item	1A.	"Risk	Factors	—	The	Level	of	Our	Indebtedness	Could	Adversely	Affect	Our	Financial	Condition	and Impair	Our	Ability	to	Operate	Our	Business".

# Other	Income,	net

Other	income,	net	was	$12.7	million,	$11.5	million	and	$14.4	million	in	fiscal	2018,	2017	and	2016,	respectively.	Other	income,	net	in	fiscal	2018 included	a	$12.3	million	gain	on	the	sale	of	our	solid	waste	management	brokerage	services	business.	Other	income,	net	in	fiscal	2017	primarily	included income	from	the	sale	of	certain	investments.	Other	income,	net	in	fiscal	2016	included	a	$12.1	million	gain	on	investment	in	Grupo	Gondi	related	to	the three	corrugated	box	plants	we	contributed	to	the	joint	venture.

# Gain	on	Sale	of	HH&B

On	April	6,	2017,	we	announced	that	we	had	completed	the	HH&B	Sale.	In	fiscal	2017,	we	recorded	a	pre-tax	gain	on	sale	of	$192.8	million.	We	used the	proceeds	from	the	HH&B	Sale	in	connection	with	the	MPS	Acquisition.

# Provision	for	Income	Taxes

On	December	22,	2017,	the	U.S.	government	enacted	comprehensive	tax	legislation	commonly	referred	to	as	the	Tax	Cuts	and	Jobs	Act	(H.R.	1)	(the "Tax	Act").	The	Tax	Act	contains	significant	changes	to	corporate	taxation,	including	(i)	the	reduction	of	the	corporate	income	tax	rate	to	21%,	(ii)	the acceleration	of	expensing	for	certain	business	assets,	(iii)	the	one-time	transition	tax	related	to	the	transition	of	U.S.	international	tax	from	a	worldwide	tax system	to	a	territorial	tax	system,	(iv)	the	repeal	of	the	domestic	production	deduction,	(v)	additional	limitations	on	the	deductibility	of	interest	expense	and (vi)	expanded	limitations	on	executive	compensation.	The	key	impacts	of	the	Tax	Act	on	our	financial	statements	in	fiscal	2018	were	the	remeasurement	of deferred	tax	balances	to	the	new

corporate	 tax	rate	and	an	accrual	 for	 the	one-time	 transition tax liability. See	"Note	 5. Income	 Taxes	— Impacts	of	the	Tax	Act"	of the	Notes to Consolidated	Financial	Statements	for	additional	information.

We	recorded	income	tax	benefit	from	continuing	operations	of	$874.5	million,	at	an	effective	tax	rate	benefit	of	84.5%	in	fiscal	2018,	including	the $1,128.8	million	provisional	benefit	of	the	Tax	Act,	as	compared	to	income	tax	expense	from	continuing	operations	of	$159.0	million,	at	an	effective	tax	rate of	18.5%	in	fiscal	2017,	and	compared	to	an	income	tax	expense	from	continuing	operations	of	$89.8	million,	at	an	effective	tax	rate	expense	of	36.7%	in fiscal	2016.

The	effective	tax	rate	benefit	from	continuing	operations	for	fiscal	2018	was	lower	than	the	statutory	federal	rate	primarily	due	to	(i)	the	provisional amounts	 related	 to	 the	 enactment	 of	 the	 Tax	 Act,	 (ii)	 favorable	 tax	 items,	 such	 as	 the	 domestic	 production	 deduction,	 tax	 benefit	 of	 share-based compensation	and	cash	tax	planning	that	resulted	in	reduced	deferred	tax	liabilities	(iii)	true	up	of	certain	deferred	taxes	and	foreign	tax	returns,	and	(iv)	a change	in	valuation	allowance,	partially	offset	by	(v)	the	inclusion	of	state	taxes	and	(vi)	the	exclusion	of	tax	benefits	related	to	losses	recorded	by	certain foreign	operations.

The	effective	tax	rate	from	continuing	operations	for	fiscal	2017	was	lower	than	the	statutory	rate	primarily	due	to	(i)	low	rates	of	tax	applicable	to	the HH&B	Sale,	(ii)	a	$28.7	million	tax	benefit	related	to	the	reduction	of	a	state	deferred	tax	liability	as	a	result	of	an	internal	U.S.	legal	entity	restructuring	that simplified	future	operating	activities	within	the	U.S.,	(iii)	favorable	tax	items,	such	as	the	domestic	manufacturer's	deduction,	(iv)	lower	tax	rates	applied	to foreign	earnings,	primarily	in	Canada,	and	(v)	a	change	in	valuation	allowance	due	to	realization	of	capital	loss	carryforward,	partially	offset	by	(vi)	the exclusion	of	tax	benefits	related	to	losses	recorded	by	certain	foreign	operations	and	(vii)	the	inclusion	of	state	taxes.

The	effective	tax	rate	from	continuing	operations	for	fiscal	2016	was	different	than	the	statutory	rate	primarily	due	to	(i)	the	impact	of	state	taxes,	(ii) the	ability	to	claim	the	domestic	manufacturer's	deduction	against	U.S.	taxable	earnings,	(iii)	the	deconsolidation	of	a	subsidiary	related	to	the	Grupo	Gondi joint	venture,	including	non-deductible	goodwill	disposed	of	in	connection	with	the	transaction,	and	(iv)	an	increase	in	valuation	allowances	and	a	tax	rate differential	with	respect	to	foreign	earnings	primarily	in	Canada.

See	"Note	5.	Income	Taxes"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Loss	from	Discontinued	Operations

On	May	15,	2016,	we	completed	the	Separation.	Subsequent	to	the	Separation,	the	operating	results	of	our	former	Specialty	Chemicals	segment	are reported	as	discontinued	operations.	Loss	from	discontinued	operations,	net	of	tax,	was	$544.7	million	for	fiscal	2016	as	a	result	of	goodwill	and	intangible impairments,	and	restructuring	and	other	costs	being	partially	offset	by	income	from	operations.

In	the	first	quarter	of	fiscal	2016,	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	the	results	of	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.	In	the	third	quarter	of	fiscal	2016,	in	conjunction	with	the	Separation,	we	performed	an	impairment	assessment	under the	 held	 for	 sale	 model	 and	 recorded	 a	 pre-tax	 non-cash	 impairment	 charge	 of	 $101.1	 million	 for	 a	 customer	 relationships	 intangible.	 See	 "Note	 7. Discontinued	Operations"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

# Results	of	Operations	—	Segment	Data

# North	American	Corrugated	Packaging	Shipments

Corrugated	Packaging	Shipments	are	expressed	as	a	tons	equivalent,	which	includes	external	and	intersegment	tons	shipped	from	our	Corrugated Packaging	mills	plus	Corrugated	Packaging	container	shipments	converted	from	billion	square	feet	("BSF")	to	tons.	We	have	presented	the	Corrugated Packaging	Shipments	in	two	groups:	North	American	and	Brazil	/	India	because	we	believe	investors,	potential	investors,	securities	analysts	and	others	find this	breakout	useful	when	evaluating	our	operating	performance.	The	table	below	reflects	shipments	in	thousands	of	tons,	BSF	and	millions	of	square	feet ("MMSF").

|  | First<br>Quarter | Second<br>Quarter | Third<br>Quarter | Fourth<br>Quarter | Fiscal<br>Year |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Fiscal\t2016 |  |  |  |  |  |
| North\tAmerican\tCorrugated\tPackaging |  |  |  |  |  |
| \t\t\tShipments\t-\tthousands\tof\ttons | 2,046.7 | 2,040.3 | 2,114.1 | 2,153.2 | 8,354.3 |
| North\tAmerican\tCorrugated\tContainers |  |  |  |  |  |
| \t\t\tShipments\t-\tBSF | 18.7 | 18.2 | 18.6 | 18.9 | 74.4 |
| North\tAmerican\tCorrugated\tContainers |  |  |  |  |  |
| \t\t\tPer\tShipping\tDay\t-\tMMSF | 306.3 | 288.6 | 291.4 | 294.5 | 295.1 |
| Fiscal\t2017 |  |  |  |  |  |
| North\tAmerican\tCorrugated\tPackaging |  |  |  |  |  |
| \t\t\tShipments\t-\tthousands\tof\ttons | 2,031.9 | 2,116.1 | 2,112.7 | 2,079.7 | 8,340.4 |
| North\tAmerican\tCorrugated\tContainers |  |  |  |  |  |
| \t\t\tShipments\t-\tBSF | 18.8 | 18.7 | 19.4 | 19.6 | 76.5 |
| North\tAmerican\tCorrugated\tContainers\tPer |  |  |  |  |  |
| \t\t\tShipping\tDay\t-\tMMSF | 312.9 | 291.9 | 308.0 | 316.6 | 307.2 |
| Fiscal\t2018 |  |  |  |  |  |
| North\tAmerican\tCorrugated\tPackaging |  |  |  |  |  |
| \t\t\tShipments\t-\tthousands\tof\ttons | 2,045.6 | 2,112.1 | 2,096.4 | 2,163.8 | 8,417.9 |
| North\tAmerican\tCorrugated\tContainers |  |  |  |  |  |
| \t\t\tShipments\t-\tBSF | 19.8 | 19.7 | 20.5 | 20.3 | 80.3 |
| North\tAmerican\tCorrugated\tContainers\tPer |  |  |  |  |  |
| \t\t\tShipping\tDay\t-\tMMSF | 325.4 | 311.7 | 320.5 | 321.9 | 319.8 |

# Brazil	/	India	Corrugated	Packaging	Shipments

(1) Net	Sales	before	intersegment	eliminations

# Net	Sales	(Aggregate)	—	Corrugated	Packaging	Segment

Net	sales	before	intersegment	elimination	for	the	Corrugated	Packaging	segment	increased	$695.1	million	in	the	fiscal	2018	compared	to	fiscal	2017, primarily	due	to	$683.5	million	of	higher	corrugated	selling	price/mix,	and	$156.7	million	of	higher	corrugated	volumes	(including	acquisitions),	which	were partially	offset	by	$84.5	million	of	lower	net	sales	from	our	recycling	operations	primarily	due	to	lower	recycled	fiber	prices,	$36.2	million	of	unfavorable foreign	currency	impacts	and	$24.4	million	of	other	items,	primarily	due	to	the	deconsolidation	of	a	foreign	joint	venture	in	fiscal	2017.

Net	sales	before	intersegment	eliminations	for	the	Corrugated	Packaging	segment	increased	$539.8	million	in	fiscal	2017	compared	to	fiscal	2016, primarily	due	to	$321.8	million	of	higher	corrugated	selling	price/mix,	$143.9	million	of	higher	net	sales	of	our	recycling	operations,	primarily	due	to	higher recycled	fiber	prices,	$98.2	million	of	higher	corrugated	volumes,	including	acquisitions,	and	$55.9	million	of	favorable	foreign	currency	impacts.	These increases	were	partially	offset	by	an	estimated	$45.0	million	decrease	due	to	the	impact	of	several	hurricanes	in	fiscal	2017	and	a	net	$42.2	million	of	lower corrugated	net	sales	due	to	a	shift	in	sales	from	converted	boxes	in	the	prior	year	period	to	sales	of	containerboard	in	fiscal	2017	as	a	result	of	having contributed	three	box	plants	to	the	Grupo	Gondi	joint	venture	in	April	2016.

# Segment	Income	—	Corrugated	Packaging	Segment

Segment	income	attributable	to	the	Corrugated	Packaging	segment	in	fiscal	2018	increased	$454.0	million	compared	to	fiscal	2017,	primarily	due	to	an estimated	 $529.8	 million	 of	 higher	 corrugated	 selling	 price/mix,	 an	 estimated	 $110.7	 million	 of	 productivity	 improvements	 and	 $25.2	 million	 of	 higher corrugated	volumes	(including	acquisitions).	These	increases	were	partially	offset	by	an	estimated	$78.9	million	of	increased	depreciation	and	amortization, $52.2	million	for	the	net	impact	of	cost	inflation,	and	an	estimated	$80.6	million	of	other	items	including	$20.4	million	of	lower	contributions	from	our	recycling operations	driven	by	lower	recycled	fiber	costs,	an	estimated	$19.0	million	impact	of	start-up	issues	following	major	maintenance	outages	partially	offset	by a	$9.5	million	lower	asset	retirement	obligations	adjustment	than	in	the	prior	year.	The	net	impact	of	cost	inflation	included	lower	recycled	fiber	costs	that were	more	than	offset	by	higher	freight	costs,	chemical	costs,	virgin	fiber	costs	and	wage	and	other	costs	compared	to	the	prior	year.	The	increased depreciation	and	amortization	was	primarily	a	function	of	acquisitions,	capital	investments	and	$17.1	million	of	increased	SG&A	intangible	amortization	due to	acquisitions,	and	included	$27.0	million	of	accelerated	depreciation	associated	with	assets	being	replaced	due	to	projects	to	install	a	330"	state-of-the-art kraft	linerboard	machine	at	our	Florence,	South	Carolina	mill	and	to	build	a	new	corrugated	box	plant	in	the	Brazilian	state	of	Sao	Paulo.

Segment	income	attributable	to	the	Corrugated	Packaging	segment	in	fiscal	2017	increased	$14.0	million	to	$753.9	million	compared	to	$739.9	million in	fiscal	2016.	The	increase	was	primarily	due	to	an	estimated	$285.4	million	of	favorable	selling	price/mix,	$154.4	million	of	synergy	and	productivity improvements	and	$21.0	million	of	favorable	corrugated	volumes,	including	acquisitions.	These	factors	were	largely	offset	by	an	estimated	$380.0	million	of cost	inflation,	the	impact	of	several	hurricanes	and	legal	charges	that	reduced	segment	income	by	an	estimated	$40.4	million	and	higher	depreciation	and amortization	of	$18.3	million.	The	primary	inflation	resulted	from	materials,	energy,	freight,	and	wage	and	other	costs.

# Consumer	Packaging	Shipments

Consumer	Packaging	Shipments	are	expressed	as	a	tons	equivalent,	which	includes	external	and	intersegment	tons	shipped	from	our	Consumer Packaging	mills	plus	Consumer	Packaging	converting	shipments	converted	from	BSF	to	tons.	The	shipment	data	table	excludes	dispensing	sales	(prior	to the	April	6,	2017	HH&B	Sale)	and	merchandising	displays	since	there	is	not	a	common	unit	of	measure,	as	well	as	gypsum	paperboard	liner	tons	produced by	Seven	Hills	since	it	is	not	consolidated.

|  | First<br>Quarter | Second<br>Quarter | Third<br>Quarter | Fourth<br>Quarter | Fiscal<br>Year |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Fiscal\t2016 |  |  |  |  |  |
| Consumer\tPackaging\tShipments\t-\tthousands |  |  |  |  |  |
| \t\t\tof\ttons | 949.3 | 974.4 | 986.3 | 998.7 | 3,908.7 |
| Consumer\tPackaging\tConverting\tShipments\t-\tBSF | 8.8 | 9.0 | 9.5 | 9.4 | 36.7 |
| Consumer\tPackaging\tConverting\tPer\tShipping |  |  |  |  |  |
| \t\t\tDay\t-\tMMSF | 144.2 | 143.7 | 148.5 | 146.3 | 145.7 |
| Fiscal\t2017 |  |  |  |  |  |
| Consumer\tPackaging\tShipments\t-\tthousands |  |  |  |  |  |
| \t\t\tof\ttons | 916.5 | 947.0 | 957.2 | 1,023.2 | 3,843.9 |
| Consumer\tPackaging\tConverting\tShipments\t-\tBSF | 9.0 | 8.9 | 9.9 | 11.1 | 38.9 |
| Consumer\tPackaging\tConverting\tPer\tShipping |  |  |  |  |  |
| \t\t\tDay\t-\tMMSF | 149.7 | 138.7 | 157.2 | 179.6 | 156.2 |
| Fiscal\t2018 |  |  |  |  |  |
| Consumer\tPackaging\tShipments\t-\tthousands |  |  |  |  |  |
| \t\t\tof\ttons | 982.8 | 992.4 | 1,025.3 | 1,031.7 | 4,032.2 |
| Consumer\tPackaging\tConverting\tShipments |  |  |  |  |  |
| \t\t\t-\tBSF | 10.8 | 10.7 | 11.2 | 11.2 | 43.9 |
| Consumer\tPackaging\tConverting\tPer\tShipping |  |  |  |  |  |
| \t\t\tDay\t-\tMMSF | 176.9 | 170.1 | 174.9 | 178.1 | 175.0 |

| (In	millions,	except	percentages) | Net	Sales	(1) | Segment<br>Income | Return<br>on	Sales |  |
| :--- | :--- | :--- | :--- | :--- |
| Fiscal\t2016 |  |  |  |  |
| First\tQuarter | $1,542.2 | $91.2 |  | 5.9% |
| Second\tQuarter | 1,588.4 | 99.7 |  | 6.3 |
| Third\tQuarter | 1,635.8 | 151.7 |  | 9.3 |
| Fourth\tQuarter | 1,621.7 | 139.1 |  | 8.6 |
| Total | $6,388.1 | $481.7 |  | 7.5% |
| Fiscal\t2017 |  |  |  |  |
| First\tQuarter | $1,510.9 | $87.6 |  | 5.8% |
| Second\tQuarter | 1,554.6 | 118.8 |  | 7.6 |
| Third\tQuarter | 1,520.7 | 94.8 |  | 6.2 |
| Fourth\tQuarter | 1,866.3 | 124.6 |  | 6.7 |
| Total | $6,452.5 | $425.8 |  | 6.6% |
| Fiscal\t2018 |  |  |  |  |
| First\tQuarter | $1,763.3 | $92.4 |  | 5.2% |
| Second\tQuarter | 1,804.4 | 99.3 |  | 5.5 |
| Third\tQuarter | 1,844.5 | 130.3 |  | 7.1 |
| Fourth\tQuarter | 1,879.2 | 132.6 |  | 7.1 |
| Total | $7,291.4 | $454.6 |  | 6.2% |

# Net	Sales	(Aggregate)	—	Consumer	Packaging	Segment

Net	sales	before	intersegment	eliminations	for	the	Consumer	Packaging	segment	increased	$838.9	million	in	fiscal	2018	compared	to	the	prior	year period	primarily	due	to	the	$1,143.1	million	increase	in	net	sales	from	acquisitions	(primarily	the	MPS	Acquisition)	and	$66.6	million	of	higher	selling price/mix,	partially	offset	by	the	absence	of	net	sales	from	HH&B	(which	totaled	$297.6	million	in	the	prior	year	period)	due	to	the	HH&B	Sale	and	$71.1 million	of	lower	volumes.	The	volume	decline	primarily	reflects	lower	sales	of	merchandising	displays	and	lower	pulp	shipments.

Net	sales	before	intersegment	eliminations	for	the	Consumer	Packaging	segment	increased	$64.4	million	in	fiscal	2017	compared	to	fiscal	2016 primarily	as	a	result	of	$575.1	million	of	aggregate	net	sales	from	the	MPS	Acquisition,	the	Packaging	Acquisition	and	the	Hannapak	Acquisition,	which were	largely	offset	by	$188.5	million	of	lower	volumes,	a	$276.8	million	decrease	in	net	sales	related	to	the	absence	of	net	sales	from	HH&B	since	April 2017,	$26.1	million	of	unfavorable	selling	price/mix	and	an	estimated	$20.0	million	decrease	due	to	the	impact	of	several	hurricanes	in	fiscal	2017.

# Segment	Income	—	Consumer	Packaging	Segment

Segment	income	attributable	to	the	Consumer	Packaging	segment	in	fiscal	2018	increased	$28.8	million	compared	to	the	prior	year	period,	primarily due	to	an	estimated	$140.6	million	of	productivity	improvements,	an	increase	of	$60.5	million	of	segment	income	related	to	the	MPS	Acquisition,	$30.5 million	of	lower	depreciation	and	amortization	(excluding	the	MPS	Acquisition),	an	estimated	$31.6	million	of	higher	selling	price/mix	and	a	$20.1	million favorable	acquisition	reserve	adjustments,	all	of	which	were	largely	offset	by	an	estimated	$178.1	million	of	cost	inflation,	$38.8	million	related	to	the absence	of	income	from	HH&B,	$16.7	million	for	the	impact	of	lower	volumes	compared	to	the	prior	year	period	and	other	items.	The	net	impact	of	cost inflation	 included	 lower	recycled	 fiber	 that	was	more	 than	offset	by	higher	 freight	costs,	chemical	costs,	virgin	 fiber	costs	and	wage	and	other	costs compared	to	the	prior	year	period.	Consumer	Packaging	segment	income	in	fiscal	2017	was	reduced	by	$25.1	million	of	acquisition	inventory	step-up expense	primarily	related	to	the	MPS	Acquisition.

Segment	income	attributable	to	the	Consumer	Packaging	segment	in	fiscal	2017	decreased	$55.9	million	compared	to	fiscal	2016,	primarily	due	to	an estimated	$169.2	million	of	cost	inflation,	$50.2	million	for	the	impact	of	lower	volumes,	the	$25.7	million	impact	of	lower	income	from	HH&B	in	fiscal	2017 as	compared	to	the	full	year	in	fiscal	2016,	a	$20.4	million	increase	in	fiscal	2017	compared	to	fiscal	2016	for	the	expensing	of	inventory	stepped-up	in purchase	accounting,	primarily	related	to	the	MPS	Acquisition	in	fiscal	2017	and	the	Packaging	Acquisition	in	fiscal	2016,	an	estimated	$12.2	million	related to	the	impact	of	several	hurricanes	in	fiscal	2017	and	$8.8	million	of	lower	selling	price/mix.	These	factors	were	partially	offset	by	synergy	and	productivity improvements	of	an	estimated	$203.8	million,	a	$29.4	million	contribution	from	the	operations	acquired	in	the	MPS	Acquisition	prior	to	expensing	$24.7 million	of	 inventory	step-up	and	$15.3	million	of	 lower	depreciation	and	amortization	expense.	The	 lower	depreciation	and	amortization	expense	was primarily	due	to	a	$10.1	million	pre-tax	benefit	from	ceasing	recording	depreciation	and	amortization	expense	in	the	second	quarter	of	fiscal	2017	in	HH&B since	it	was	designated	as	held	for	sale.	The	primary	inflation	resulted	from	materials,	energy,	freight,	and	wage	and	other	costs.

| (In	millions,	except	percentages) | Net	Sales	(1) | Segment<br>Income	(Loss) | Return<br>on	Sales |
| :--- | :--- | :--- | :--- |
| Fiscal\t2016 |  |  |  |
| First\tQuarter | $15.4 | $0.7 | 4.5% |
| Second\tQuarter | 18.7 | (4.0) | (21.4) |
| Third\tQuarter | 42.0 | 9.5 | 22.6 |
| Fourth\tQuarter | 43.7 | (1.6) | (3.7) |
| Total | $119.8 | $4.6 | 3.8% |
| Fiscal\t2017 |  |  |  |
| First\tQuarter | $54.0 | $1.7 | 3.1% |
| Second\tQuarter | 100.0 | 17.5 | 17.5 |
| Third\tQuarter | 71.1 | 0.2 | 0.3 |
| Fourth\tQuarter | 18.7 | (5.6) | (29.9) |
| Total | $243.8 | $13.8 | 5.7% |
| Fiscal\t2018 |  |  |  |
| First\tQuarter | $11.4 | $(0.7) | (6.1)% |
| Second\tQuarter | 26.7 | 16.1 | 60.3 |
| Third\tQuarter | 64.8 | 9.9 | 15.3 |
| Fourth\tQuarter | 39.5 | (2.8) | (7.1) |
| Total | $142.4 | $22.5 | 15.8% |

# Net	Sales	(Aggregate)	—	Land	and	Development	Segment

Net	sales	for	the	Land	and	Development	segment	in	fiscal	2018,	2017	and	2016	were	$142.4	million,	$243.8	million	and	$119.8	million,	respectively. The	decrease	in	fiscal	2018	and	the	increase	in	fiscal	2017	were	due	to	the	timing	of	land	sales	as	we	monetize	the	portfolio.	We	include	the	remainder	of the	real	estate	holdings	in	assets	held	for	sale	because	we	have	met	the	held	for	sale	criteria.	We	expect	to	complete	the	monetization	of	these	holdings during	fiscal	2019.	After	we	complete	the	monetization,	the	segment	will	cease	to	exist.

# Segment	Income	(Loss)	—	Land	and	Development	Segment

Segment	income	attributable	to	the	Land	and	Development	segment	was	$22.5	million,	$13.8	million	and	$4.6	million	in	fiscal	2018,	2017	and	2016, respectively.	The	segment's	assets	were	stepped-up	to	fair	value	in	fiscal	2015	as	a	result	of	purchase	accounting,	which	resulted	in	substantially	lower margins	on	the	properties	sold	compared	to	earlier	levels.	The	pre-tax	non-cash	impairments	of	certain	mineral	rights	and	real	estate	discussed	above	under the	caption	"Land	and	Development	Impairments"	are	not	included	in	segment	income.

# Liquidity	and	Capital	Resources

On	January	29,	2018,	we	announced	that	a	definitive	agreement	had	been	signed	for	us	to	acquire	all	of	the	outstanding	shares	of	KapStone	for $35.00	per	share	and	the	assumption	of	approximately	$1.36	billion	in	net	debt,	for	a	total	enterprise	value	of	approximately	$4.9	billion.	In	contemplation	of the	transaction,	on	March	6,	2018,	we	issued	$600.0	million	aggregate	principal	amount	of	3.75%	senior	notes	due	2025	and	$600.0	million	aggregate principal	amount	of	4.0%	senior	notes	due	2028	in	an	unregistered	offering	pursuant	to	Rule	144A	and	Regulation	S	under	the	Securities	Act	of	1933,	as amended	(the	"Securities	Act").	In	addition,	on	March	7,	2018,	we	entered	into	the	Delayed	Draw	Credit	Facilities	(as	hereinafter	defined)	that	provide	for $3.8	billion	of	senior	unsecured	term	loans.	On	November	2,	2018,	in	connection	with	the	closing	of	the	KapStone	Acquisition,	we	drew	upon	the	facility	in full.	The	proceeds	of	the	Delayed	Draw	Credit	Facilities	(as	hereinafter	defined)	and	other	sources	of	cash	were	used	to	pay	the	consideration	for	the KapStone	Acquisition,	 to	 repay	 certain	 existing	 indebtedness	 of	 KapStone	 and	 to	 pay	 fees	 and	 expenses	 incurred	 in	 connection	 with	 the	 KapStone Acquisition.

We	fund	our	working	capital	requirements,	capital	expenditures,	mergers,	acquisitions	and	investments,	restructuring	activities,	dividends	and	stock repurchases	 from	 net	 cash	 provided	 by	 operating	 activities,	 borrowings	 under	 our	 credit	 facilities,	 proceeds	 from	 our	 New	A/R	 Sales	Agreement	 (as hereinafter	defined),	proceeds	from	the	sale	of	property,	plant	and	equipment	removed	from	service	and	proceeds	received	in	connection	with	the	issuance of	debt	and	equity	securities.	See	"Note	13.	Debt"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.	Funding	for	our	domestic operations	in	the	foreseeable	future	is	expected	to	come	from	sources	of	liquidity	within	our	domestic	operations,	including	cash	and	cash	equivalents,	and available	borrowings	under	our	credit	facilities.	As	such,	our	foreign	cash	and	cash	equivalents	are	not	expected	to	be	a	key	source	of	liquidity	to	our domestic	operations.

At	September	30,	2018,	excluding	the	Delayed	Draw	Credit	Facilities,	we	had	approximately	$3.2	billion	of	availability	under	our	committed	credit facilities,	primarily	under	our	revolving	credit	facility,	the	majority	of	which	matures	on	July	1,	2022.	This	liquidity	may	be	used	to	provide	for	ongoing	working capital	needs	and	for	other	general	corporate	purposes,	including	acquisitions,	dividends	and	stock	repurchases.

Certain	restrictive	covenants	govern	our	maximum	availability	under	the	credit	facilities.	We	test	and	report	our	compliance	with	these	covenants	as required	and	we	were	in	compliance	with	all	of	these	covenants	at	September	30,	2018.	At	September	30,	2018,	we	had	$104.9	million	of	outstanding letters	of	credit	not	drawn	upon.

Cash	and	cash	equivalents	were	$636.8	million	at	September	30,	2018	and	$298.1	million	at	September	30,	2017.	We	used	a	significant	portion	of	the cash	and	cash	equivalents	on	hand	at	September	30,	2018	in	connection	with	the	closing	of	the	KapStone	Acquisition.	Approximately	20%	of	the	cash	and cash	equivalents	at	September	30,	2018	were	held	outside	of	the	U.S.	At	September	30,	2018,	total	debt	was	$6,415.2	million,	$740.7	million	of	which	was current.	At	September	30,	2017,	total	debt	was	$6,554.8	million,	$608.7	million	of	which	was	current.

# Cash	Flow	Activity

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Net\tcash\tprovided\tby\toperating\tactivities | $2,420.9 | $1,900.5 | $1,688.4 |
| Net\tcash\tused\tfor\tinvesting\tactivities | $(1,298.9) | $(1,285.8) | $(1,351.4) |
| Net\tcash\tused\tfor\tfinancing\tactivities | $(755.1) | $(655.4) | $(231.0) |

Net	cash	provided	by	operating	activities	during	fiscal	2018	increased	$520.4	million	from	fiscal	2017	primarily	due	to	higher	cash	earnings	and	lower cash	taxes	due	to	the	impact	of	the	Tax	Act.	Net	cash	provided	by	operating	activities	during	fiscal	2017	increased	$212.1	million	from	fiscal	2016	primarily due	to	a	$111.6	million	net	increase	in	cash	flow	from	working	capital	changes	plus	higher	after-tax	cash	proceeds	from	our	Land	and	Development segment's	accelerated	monetization.	The	changes	in	working	capital	in	fiscal	2018,	2017	and	2016	included	a	source	of	cash	resulting	from	the	sale	of $115.1	million,	$64.7	million	and	$99.4	million,	respectively,	of	accounts	receivables	in	connection	with	the	A/R	Sales	Agreement.

Net	cash	used	for	investing	activities	of	$1,298.9	million	in	fiscal	2018	consisted	primarily	of	$999.9	million	for	capital	expenditures,	$239.9	million	for cash	paid	for	the	purchase	of	businesses,	net	of	cash	acquired	primarily

related	to	the	Plymouth	Acquisition	and	the	Schlüter	Acquisition,	and	$108.0	million	for	an	investment	in	Grupo	Gondi.	These	investments	were	partially offset	by	$24.0	million	of	proceeds	from	the	sale	of	certain	affiliates	as	well	as	our	solid	waste	management	brokerage	services	business	and	$23.3	million	of proceeds	from	the	sale	of	property,	plant	and	equipment.	Net	cash	used	for	investing	activities	in	fiscal	2017	consisted	primarily	of	$778.6	million	of	capital expenditures,	$1,588.5	million	for	the	MPS	Acquisition,	the	U.S.	Corrugated	Acquisition,	the	Island	Container	Acquisition,	the	Hannapak	Acquisition	and	the Star	Pizza	Acquisition,	partially	offset	by	a	$3.5	million	receipt	of	an	escrow	payment	from	the	Packaging	Acquisition	and	proceeds	of	$1,005.9	million	from the	HH&B	Sale	and	of	$52.6	million	of	proceeds	from	the	sale	of	property,	plant	and	equipment.	Net	cash	used	for	investing	activities	in	fiscal	2016 consisted	primarily	of	$796.7	million	of	capital	expenditures,	$376.4	million	for	the	SP	Fiber	Acquisition	and	the	Packaging	Acquisition,	$175.0	million	for	an investment	in	Grupo	Gondi	and	$36.5	million	for	the	purchase	of	debt	owed	by	GPS	in	connection	with	the	SP	Fiber	Acquisition	partially	offset	by	$31.2 million	of	proceeds	from	the	sale	of	property,	plant	and	equipment.

In	fiscal	2018,	net	cash	used	for	financing	activities	of	$755.1	million	consisted	primarily	of	cash	dividends	paid	to	stockholders	of	$440.9	million	and purchases	of	Common	Stock	of	$195.1	million	and	net	repayments	of	debt	of	$120.1	million.	In	fiscal	2017,	net	cash	used	for	financing	activities	consisted primarily	of	cash	dividends	paid	to	stockholders	of	$403.2	million,	net	repayments	of	debt	of	$145.2	million	and	purchases	of	Common	Stock	of	$93.0	million. In	fiscal	2016,	net	cash	used	for	financing	activities	consisted	primarily	of	cash	dividends	paid	to	stockholders	of	$380.7	million,	purchases	of	Common Stock	of	$335.3	million	and	$105.0	million	of	cash	and	trust	funding	as	a	result	of	the	Separation,	which	was	partially	offset	by	net	additions	to	debt	of	$617.3 million.	See	"Note	7.	Discontinued	Operations"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

Our	 capital	 expenditures	 aggregated	 $999.9	 million	 in	 fiscal	 2018.	 We	 expect	 fiscal	 2019	 capital	 expenditures	 to	 be	 approximately	 $1.5	 billion, including	KapStone	and	investments	to	restore	operations	our	Panama	City,	FL	mill	following	Hurricane	Michael.	Our	base	capital	expenditures	in	fiscal 2019	should	be	approximately	$950	million	to	$1.0	billion,	with	roughly	half	invested	in	maintenance	and	half	invested	in	high	return	generating	projects.	In fiscal	2019,	we	expect	to	invest	approximately	$0.5	billion	in	strategic	projects.	The	strategic	projects	include:	(i)	installation	of	a	330"	state-of-the-art	kraft linerboard	machine	at	our	Florence,	SC	mill,	(ii)	an	upgrade	of	the	Tres	Barras	mill	that	will	add	virgin	pulping	capacity,	a	biomass	power	boiler,	a	turbine generator	and	other	equipment,	(iii)	construction	of	a	new	corrugated	box	plant	in	the	Brazilian	state	of	Sao	Paulo,	(iv)	installation	of	a	curtain	coater	at	our Mahrt,	AL	mill,	and	(v)	installation	of	a	headbox	and	upgrade	of	other	areas	of	a	paper	machine	at	our	Covington,	VA	mill.	However,	it	is	possible	that	our capital	expenditure	assumptions	may	change,	project	completion	dates	may	change,	or	we	may	decide	 to	 invest	a	different	amount	depending	upon opportunities	we	identify,	changes	in	market	conditions	or	to	comply	with	environmental	or	other	regulatory	changes.	We	estimate	 that	we	will	 invest approximately	$22	million	for	capital	expenditures	during	fiscal	2019	in	connection	with	matters	relating	to	environmental	compliance,	excluding	KapStone. We	were	obligated	to	purchase	approximately	$203	million	of	fixed	assets	at	September	30,	2018	for	various	capital	projects.	See	Item	1A.	"Risk	Factors	—

At	September	30,	2018,	the	U.S.	federal,	state	and	foreign	net	operating	losses	and	state	tax	credits	available	to	us	aggregated	approximately	$117 million	in	future	potential	reductions	of	U.S.	federal,	state	and	foreign	cash	taxes.	Based	on	our	current	projections,	we	expect	to	utilize	the	remaining	U.S. federal	net	operating	losses	and	other	U.S.	federal	credits	primarily	over	the	next	two	years.	Foreign	and	state	net	operating	losses	and	credits	will	be	used over	a	longer	period	of	time.	It	is	possible	that	our	utilization	of	these	net	operating	losses	and	credits	may	change	due	to	changes	in	taxable	income,	tax laws	or	tax	rates,	capital	expenditures	or	other	factors.	Fiscal	2018	is	the	last	year	in	which	we	will	receive	a	tax	benefit	from	the	domestic	production deduction.	Including	the	estimated	impact	of	book	and	tax	differences,	subject	to	changes	in	tax	laws,	we	expect	our	cash	tax	rate	to	move	closer	to	our income	tax	rate	in	fiscal	2019,	2020	and	2021.

During	fiscal	2018	and	2017,	we	made	contributions	of	$37.7	million	and	$34.5	million,	respectively,	to	our	U.S.	and	non-U.S.	pension	plans.	Based	on current	facts	and	assumptions,	we	expect	to	contribute	approximately	$22	million	to	our	U.S.	and	non-U.S.	pension	plans	in	fiscal	2019.	We	have	made contributions	and	expect	to	continue	to	make	contributions	in	the	coming	years	to	our	pension	plans	in	order	to	ensure	that	our	funding	levels	remain adequate	in	light	of	projected	liabilities	and	to	meet	the	requirements	of	the	Pension	Act	and	other	regulations.	The	net	over	funded	status	of	our	U.S.	and non-U.S.	pension	plans	at	September	30,	2018	was	$147.7	million.	Based	on	current	assumptions,	including	future	interest	rates,	we	estimate	that	minimum pension	contributions	to	our	U.S.	and	non-U.S.	pension	plans	will	be	in	the	range	of	approximately	$25	million	to	$27	million	annually	in	fiscal	2020

through	2023.	See	"Note	4.	Retirement	Plans"	of	the	Notes	to	Consolidated	Financial	Statements.	See	also	Item	1A. "Risk	Factors	—	Certain	of	Our

# Pension	Plans	Will	Likely	Require	Additional	Cash	Contributions".

# In	the	normal	course	of	business,	we	evaluate	our	potential	exposure	to	MEPPs,	including	with	respect	to	potential	withdrawal	liabilities.	In	fiscal	2018, we	submitted	 formal	notification	 to	withdraw	 from	 two	plans	and	recorded	an	aggregate	estimated	withdrawal	 liability	of	$184.2	million.	See	"Note	 4. Retirement	Plans	—	Multiemployer	Plans"	of	the	Notes	to	Condensed	Consolidated	Financial	Statements	for	additional	information.	See	also	Item	1A. "Risk	 Factors	 —	 We	 May Incur	 Withdrawal	 Liability	 and/or Increased	 Funding	 Requirements in	 Connection	 with the	 MEPPs in	 Which	 We Participate".

In	July	2015,	our	board	of	directors	authorized	a	repurchase	program	of	up	to	40.0	million	shares	of	our	Common	Stock,	representing	approximately 15%	of	our	outstanding	Common	Stock	as	of	July	1,	2015.	Shares	of	our	Common	Stock	may	be	purchased	from	time	to	time	in	open	market	or	privately negotiated	 transactions.	The	 timing,	manner,	price	and	amount	of	repurchases	will	be	determined	by	management	at	 its	discretion	based	on	 factors, including	the	market	price	of	our	Common	Stock,	general	economic	and	market	conditions	and	applicable	legal	requirements.	The	repurchase	program	may be	commenced,	suspended	or	discontinued	at	any	time.	In	fiscal	2018,	we	repurchased	approximately	3.4	million	shares	of	our	Common	Stock	for	an aggregate	cost	of	$195.1	million.	In	fiscal	2017,	we	repurchased	approximately	1.8	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$93.0 million.	In	fiscal	2016,	we	repurchased	approximately	8.1	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$335.3	million.	As	of	September	30, 2018,	we	had	remaining	authorization	under	the	repurchase	program	authorized	in	July	2015	to	purchase	approximately	21.3	million	shares	of	our	Common Stock.

We	anticipate	that	we	will	be	able	to	fund	our	capital	expenditures,	interest	payments,	dividends	and	stock	repurchases,	pension	payments,	working capital	needs,	note	repurchases,	restructuring	activities,	repayments	of	current	portion	of	long-term	debt	and	other	corporate	actions	for	the	foreseeable future	 from	cash	generated	 from	operations,	borrowings	under	our	credit	 facilities,	proceeds	 from	our	New	A/R	Sales	Agreement,	proceeds	 from	 the issuance	of	debt	or	equity	securities	or	other	additional	long-term	debt	financing,	including	new	or	amended	facilities.	In	addition,	we	continually	review	our capital	structure	and	conditions	in	the	private	and	public	debt	markets	in	order	to	optimize	our	mix	of	indebtedness.	In	connection	with	these	reviews,	we may	 seek	 to	 refinance	 existing	 indebtedness	 to	 extend	 maturities,	 reduce	 borrowing	 costs	 or	 otherwise	 improve	 the	 terms	 and	 composition	 of	 our indebtedness.

# Contractual	Obligations

We	summarize	our	enforceable	and	legally	binding	contractual	obligations	at	September	30,	2018,	and	the	effect	these	obligations	are	expected	to have	on	our	liquidity	and	cash	flow	in	future	periods	in	the	following	table.	Certain	amounts	in	this	table	are	based	on	management's	estimates	and assumptions	about	these	obligations,	including	their	duration,	the	possibility	of	renewal,	anticipated	actions	by	third	parties	and	other	factors,	including estimated	minimum	pension	plan	contributions	and	estimated	benefit	payments	related	to	postretirement	obligations,	supplemental	retirement	plans	and deferred	compensation	plans.	Because	these	estimates	and	assumptions	are	subjective,	the	enforceable	and	legally	binding	obligations	we	actually	pay	in future	periods	may	vary	from	those	presented	in	the	table.

|  |  |  |  | Payments	Due	by	Period |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| (In\tmillions) | (In\tmillions) | Total | Fiscal\t2019 | Fiscal\t2020\nand\t2021 | Fiscal\t2022\nand\t2023 | Thereafter |
| Long-Term\tDebt,\tincluding\tcurrent\tportion, |  |  |  |  |  |  |
| \t\t\texcluding\tcapital\tlease\tobligations\t (1) | \t\t\texcluding\tcapital\tlease\tobligations\t (1) | \t $6,039.0 | \t $726.6 | \t $824.8 | \t $1,351.0 | \t $3,136.6 |
| Operating\tlease\tobligations\t(2) | Operating\tlease\tobligations\t(2) | 615.8 | 132.1 | 199.9 | 118.4 | 165.4 |
| Capital\tlease\tobligations\t(3) | Capital\tlease\tobligations\t(3) | 152.5 | 5.0 | 6.7 | 2.7 | 138.1 |
| Purchase\tobligations\tand\tother | (4)\t(5)\t(6) | 2,210.5 | 1,676.6 | 224.1 | 114.9 | 194.9 |
| Total | Total | \t $9,017.8 | \t $2,540.3 | \t $1,255.5 | \t $1,587.0 | \t $3,635.0 |

(1) Includes	only	principal	payments	owed	on	our	debt	assuming	that	all	of	our	long-term	debt	will	be	held	to	maturity,	excluding	scheduled	payments.	We	have excluded	$205.2	million	of	fair	value	of	debt	step-up,	deferred	financing	costs	and	unamortized	bond	discounts	from	the	table	to	arrive	at	actual	debt	obligations. See	"Note	13.	Debt"	of	the	Notes	to	Consolidated	Financial	Statements	for	information	on	the	interest	rates	that	apply	to	our	various	debt	instruments.

(2) See	"Note	14.	Operating	Leases"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

(3) The	fair	value	step-up	of	$18.5	million	is	excluded.	See	"Note	13.	Debt	—	Capital	Lease	and	Other	Indebtedness"	of	the	Notes	to	Consolidated	Financial Statements	for	additional	information.

(4) Purchase	obligations	include	agreements	to	purchase	goods	or	services	that	are	enforceable	and	legally	binding	and	that	specify	all	significant	terms,	including: fixed	or	minimum	quantities	to	be	purchased;	fixed,	minimum	or	variable	price	provision;	and	the	approximate	timing	of	the	transaction.	Purchase	obligations exclude	agreements	that	are	cancelable	without	penalty.

(5) We	 have	 included	 in	 the	 table	 future	 estimated	 minimum	 pension	 plan	 contributions	 and	 estimated	 benefit	 payments	 related	 to	 postretirement	 obligations, supplemental	retirement	plans	and	deferred	compensation	plans.	Our	estimates	are	based	on	factors,	such	as	discount	rates	and	expected	returns	on	plan	assets. Future	contributions	are	subject	to	changes	in	our	underfunded	status	based	on	factors	such	as	investment	performance,	discount	rates,	returns	on	plan	assets and	changes	in	legislation.	It	is	possible	that	our	assumptions	may	change,	actual	market	performance	may	vary	or	we	may	decide	to	contribute	different	amounts. We	have	excluded	$247.8	million	of	multiemployer	pension	plan	withdrawal	liabilities	recorded	as	of	September	30,	2018	due	to	lack	of	definite	payout	terms	for certain	of	the	obligations.	See	"Note	4.	Retirement	Plans	–	Multiemployer	Plans"	of	the	Notes	to	Consolidated	Financial	Statements	for	additional	information.

(6) We	have	not	included	the	following	items	in	the	table:

•An	item	labeled	"other	long-term	liabilities"	reflected	on	our	consolidated	balance	sheet	because	these	liabilities	do	not	have	a	definite	pay-out	scheme.

•$158.4	million	from	the	line	item	"Purchase	obligations	and	other"	for	certain	provisions	of	the	Financial	Accounting	Standards	Board's	("FASB")	Accounting Standards	Codification	("ASC")	740,	"Income	Taxes"	associated	with	liabilities	for	uncertain	tax	positions	due	to	the	uncertainty	as	to	the	amount	and	timing of	payment,	if	any.

In	addition	to	the	enforceable	and	legally	binding	obligations	presented	in	the	table	above,	we	have	other	obligations	for	goods	and	services	and	raw materials	entered	into	in	the	normal	course	of	business.	These	contracts,	however,	are	subject	to	change	based	on	our	business	decisions.

# Expenditures	for	Environmental	Compliance

See Item 1.	"Business	 —	 Governmental	 Regulation	 —	 Environmental	 and	 Other	 Matters ",	 "Business	 —	 Governmental	 Regulation	 — CERCLA	and	Other	Remediation	Costs",	and	"Business	—	Governmental	Regulation	—	Climate	Change "	for	a	discussion	of	our	expenditures	for environmental	compliance.

# Critical	Accounting	Policies	and	Estimates

We	have	prepared	our	accompanying	consolidated	financial	statements	in	conformity	with	GAAP,	which	requires	management	to	make	estimates	that affect	the	amounts	of	revenues,	expenses,	assets	and	liabilities	reported.	Certain	critical	accounting	matters	are	described	in	"Note	1.	Description	of Business	and	Summary	of	Significant	Accounting	Policies"	of	the	Notes	to	Consolidated	Financial	Statements.	See	also	Item	7A.	" Quantitative	and Qualitative	Disclosures	About	Market	Risk".	These	critical	accounting	matters	are	both	important	to	the	portrayal	of	our	financial	condition	and	results	and require	some	of	management's	most	subjective	and	complex	judgments.	The	accounting	for	these	matters	involves	the	making	of	estimates	based	on current	facts,	circumstances	and	assumptions	that,	in	management's	judgment,	could	change	in	a	manner	that	would	materially	affect	management's	future estimates	with	respect	to	such	matters	and,	accordingly,	could	cause	our	future	reported	financial	condition	and	results	to	differ	materially	from	those	that we	are	currently	reporting	based	on	management's	current	estimates.

# Critical	accounting	matters	discussed	in	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies "	of	the	Notes	to

Consolidated	Financial	Statements	include	(i)	accounts	receivable	and	allowances;	(ii)	goodwill	and	long-lived	assets;	(iii)	restructuring	and	other	costs;	(iv) business	 combinations;	 (v)	 fair	 value	 of	 financial	 instruments	 and	 nonfinancial	 assets	 and	 liabilities;	 (vi)	 income	 taxes;	 and	 (vii)	 pension	 and	 other postretirement	benefits.

# Accounts	Receivable	and	Allowances

We	have	an	allowance	for	doubtful	accounts,	credits,	returns	and	allowances,	and	cash	discounts	that	serve	to	reduce	the	value	of	our	gross	accounts receivable	to	the	amount	we	estimate	we	will	ultimately	collect.	The	allowances	contain	uncertainties	because	the	calculation	requires	management	to	make assumptions	and	apply	judgment	regarding	our	customers'	credit	worthiness	and	the	credits,	returns	and	allowances	and	cash	discounts	that	may	be	taken by	our	customers.	We	derive	our	accounts	receivable	from	revenue	earned	from	customers	located	primarily	in	North	America,	South	America,	Europe, Asia	and	Australia.	Given	our	diverse	customer	base,	we	have	limited	exposure	to	credit	loss	from	any	particular	customer	or	industry	segment,	and	hence we	generally	do	not	require	collateral	in	connection	with	engaging	in	commercial	transactions	with	them.	We	perform	ongoing	evaluations	of	our	customers' financial	condition	and	adjust	credit	limits	based	upon	payment	history	and	the	particular	customer's	current	credit	worthiness,	as	determined	by	our	review of	their	current	financial	information.	We	continuously	monitor	collections	from	our	customers	and	maintain	a	provision	for	estimated	credit	losses	based upon	our	customers'	financial	condition,	our	collection	experience	and	any	other	relevant	customer	specific	information.	Our	assessment	of	this	and	other information	forms	the	basis	of	our	allowances.	We	do	not	believe	there	is	a	reasonable	likelihood	that	there	will	be	a	material	change	in	the	future	estimates or	assumptions	we	use	to	estimate	the	allowances.	However,	while	these	credit	losses	have	historically	been	within	our	expectations	and	the	provisions	we established,	it	is	possible	that	our	credit	loss	rates	could	be	higher	or	lower	in	the	future	depending	on	changes	in	business	conditions	and	changes	in	our customers'	credit	worthiness.	At	September	30,	2018,	our	accounts	receivable,	net	of	allowances	of	$49.7	million,	was	$2,010.7	million;	a	1%	additional	loss on	accounts	receivable	would	change	our	allowance	by	$20.1	million	and	a	5%	change	in	our	allowance	assumptions	would	change	our	allowance	by	$2.5 million.

# Goodwill

We	review	the	carrying	value	of	our	goodwill	annually	at	the	beginning	of	the	fourth	quarter	of	each	fiscal	year,	or	more	often	if	events	or	changes	in circumstances	indicate	that	the	carrying	amount	may	exceed	fair	value.	We	determine	recoverability	by	comparing	the	estimated	fair	value	of	the	reporting unit	to	which	the	goodwill	applies	to	the	carrying	value,	including	goodwill,	of	that	reporting	unit.	We	determine	the	fair	value	of	each	reporting	unit	using	the discounted	 cash	 flow	 method	 or,	 as	 appropriate,	 a	 combination	 of	 the	 discounted	 cash	 flow	 method	 and	 the	 guideline	 public	 company	 method.	 Our discounted	cash	flow	analysis	is	based	on	the	sum	of	two	components,	the	present	value	of	our	projected	cash	flows	and	the	present	value	of	a	terminal value.	The	cash	flow	estimates	are	derived	from	our	current	forecast	and	our	long-term	forecasts	prepared	for	each	reporting	unit	considering	historical results	and	anticipated	future	performance	and	capital	expenditures,	and	require	considerable	judgment.	The	discount	rates	used	to	determine	the	present value	of	future	cash	flows	were	derived	from	a	weighted	average	cost	of	capital	analysis	utilizing	a	beta	derived	from	peer	companies.	In	addition,	we	gave consideration	 in	 the	calculation	of	 the	weighted	average	cost	of	capital	 for	equity	risks,	 including	size	risk,	 industry	risk	and	country	specific	risk,	as appropriate,	for	each	of	our	reporting	units.	As	a	result	of	the	weighted	average	cost	of	capital	calculations,	the

discount	rate	used	for	each	reporting	unit	ranged	from	8.0%	to	13.5%.	We	use	perpetual	growth	rates	in	the	reporting	units	that	have	goodwill	ranging	from 0.5% to	 1.0%.	The	guideline	public	company	method	 involves	comparing	 the	reporting	unit	 to	similar	companies	whose	stock	 is	 freely	 traded	on	an organized	exchange.	The	 fair	values	determined	by	 the	discounted	cash	 flow	and	guideline	public	company	methods	were	weighted	 to	arrive	at	 the concluded	fair	value	of	the	reporting	unit.	However,	in	instances	where	comparisons	to	our	peers	was	less	meaningful,	no	weight	was	placed	on	the guideline	public	company	method	to	arrive	at	the	concluded	fair	value	of	the	reporting	unit.

Estimating	the	fair	value	of	the	reporting	unit	involves	uncertainties	because	it	requires	management	to	develop	numerous	assumptions,	including assumptions	about	the	future	growth	and	potential	volatility	in	revenues	and	costs,	capital	expenditures,	industry	economic	factors	and	future	business strategy.	The	 variability	 of	 the	 factors	 that	 management	 uses	 to	 perform	 the	 goodwill	 impairment	 test	 depends	 on	 a	 number	 of	 conditions,	 including uncertainty	about	future	events	and	cash	flows,	including	anticipated	changes	in	revenues	and	costs	and	synergies	and	productivity	improvements	resulting from	 the	 acquisitions,	 capital	 expenditures	 and	 continuous	 improvement	 projects.	These	 factors	 are	 interdependent	 and,	 therefore,	 do	 not	 change	 in isolation.	Accordingly,	 our	 accounting	 estimates	 may	 materially	 change	 from	 period	 to	 period	 due	 to	 changing	 market	 factors.	 If	 we	 had	 used	 other assumptions	and	estimates	or	if	conditions	change	in	future	periods,	our	operating	results	could	be	materially	impacted.	Any	significant	adverse	changes	in key	assumptions	about	these	reporting	units	and	their	prospects,	such	as	changes	in	our	strategy	or	products,	the	loss	of	key	customers,	regulatory changes	or	adverse	changes	in	economic	and	market	conditions	may	cause	a	change	in	the	estimated	fair	values	of	our	reporting	units	and	could	result	in an	impairment	charge	that	could	be	material	to	our	financial	statements.

During	the	fourth	quarter	of	fiscal	2018,	of	those	reporting	units	that	have	goodwill,	our	Consumer	Packaging	reporting	unit	had	a	fair	value	that exceeded	its	carrying	value	by	less	than	10%,	primarily	due	to	the	fair	value	accounting	related	to	the	Combination	and	the	MPS	Acquisition.	If	we	had concluded	that	it	was	appropriate	to	increase	the	discount	rate	we	used	by	100	basis	points	to	estimate	the	fair	value	of	each	reporting	unit	that	has goodwill,	the	fair	value	of	each	of	our	reporting	units	would	have	continued	to	exceed	its	carrying	value,	except	for	the	Consumer	Packaging	reporting	unit. The	Consumer	Packaging	reporting	unit	had	$3,610.9	million	of	goodwill	at	September	30,	2018.	No	events	have	occurred	since	the	latest	annual	goodwill impairment	assessment	that	would	necessitate	an	interim	goodwill	impairment	assessment.	We	have	not	made	any	material	changes	to	our	impairment loss	assessment	methodology	during	the	past	three	fiscal	years.	We	do	not	believe	there	is	a	reasonable	likelihood	that	there	will	be	a	material	change	in future	assumptions	or	estimates	we	use	to	calculate	impairment	losses.	However,	if	actual	results	are	not	consistent	with	our	assumptions	and	estimates, we	may	be	exposed	to	impairment	losses	that	could	be	material.

# See	Item	1A.	"Risk	Factors	—	We	Have	a	Significant	Amount	of	Goodwill	and	Other	Intangible	Assets	and	a	Write	Down	Would	Adversely Impact	Our	Operating	Results	and	Shareholders'	Equity".

# Accounting	for	Income	Taxes

Our	income	tax	expense,	deferred	tax	assets	and	liabilities,	and	liabilities	for	unrecognized	tax	benefits,	reflect	management's	best	assessment	of estimated	current	and	future	taxes	to	be	paid.	In	evaluating	our	ability	to	recover	our	deferred	tax	assets	within	the	jurisdiction	from	which	they	arise	we consider	all	available	evidence,	including	scheduled	reversals	of	deferred	tax	liabilities,	projected	future	taxable	income,	tax	planning	strategies	and	recent operations.	Significant	judgments	and	estimates	are	required	in	determining	the	consolidated	income	tax	expense.	We	recognize	interest	and	penalties related	to	unrecognized	tax	benefits	in	income	tax	expense	in	the	consolidated	statements	of	operations.	A	1%	change	in	our	effective	tax	rate	would increase	or	decrease	tax	expense	by	approximately	$10.3	million	for	fiscal	2018.	A	1%	change	in	our	effective	tax	rate	used	to	compute	deferred	tax liabilities	and	assets,	as	recorded	on	the	September	30,	2018	consolidated	balance	sheet,	would	increase	or	decrease	tax	expense	by	approximately	$97.5 million	for	fiscal	2018.

# Pension	and	Other	Postretirement	Benefits

The	funded	status	of	our	qualified	and	non-qualified	U.S.	and	non-U.S.	pension	plans	increased	$69.2	million	in	fiscal	2018.	Our	U.S.	qualified	and non-qualified	pension	and	non-U.S.	pension	plans	were	over	funded	by	$137.7	million	and	$10.0	million,	respectively,	as	of	September	30,	2018.	Our	U.S. pension	plan	benefit	obligations	were	positively	impacted	in	fiscal	2018	primarily	by	a	41-basis	point	increase	in	the	discount	rate	compared	to	the	prior measurement	 date.	The	 non-U.S.	 pension	 plan	 obligations	 were	 positively	 impacted	 in	 fiscal	 2018	 by	 a	 16-basis	 point	 increase	 in	 the	 discount	 rate compared	to	the	prior	measurement	date.	A	25-basis	point	change	in	the	discount	rate,	compensation	level,	expected	long-term	rate	of	return	on	plan assets	or	medical	cost	trend,	factoring	in	our

corridor	as	appropriate,	would	have	had	the	following	effect	on	fiscal	2018	pension	and	other	postretirement	expense	(amounts	in	the	table	in	parentheses reflect	additional	income,	in	millions):

|  | Pension	Plans |  | Postretirement	Plans |  |
| :--- | :--- | :--- | :--- | :--- |
|  | 25\tBasis\nPoint\nIncrease | 25\tBasis\nPoint\nDecrease | 25\tBasis\nPoint\nIncrease | 25\tBasis\nPoint\nDecrease |
| Discount\trate | \t $(10.5) | \t $10.8 | \t $— | \t $— |
| Compensation\tlevel | 0.3 | (0.3) | N/A | N/A |
| Expected\tlong-term\trate\tof\treturn\ton\tplan\tassets | (13.4) | 13.4 | N/A | N/A |
| Medical\tcost\ttrend | N/A | N/A | — | — |

# New	Accounting	Standards

See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies "	of	the	Notes	to	Consolidated	Financial	Statements	for	a full	description	of	recent	accounting	pronouncements,	including	the	respective	expected	dates	of	adoption	and	expected	effects	on	our	results	of	operations and	financial	condition.

# Item	7A. QUANTITATIVE	AND	QUALITATIVE	DISCLOSURES	ABOUT	MARKET	RISK

We	are	exposed	to	market	risk	from	changes	in,	among	other	things,	interest	rates,	foreign	currencies	and	commodity	prices.	We	aim	to	identify	and understand	these	risks	and	then	implement	strategies	to	manage	them.	When	evaluating	these	strategies,	we	evaluate	the	fundamentals	of	each	market, our	sensitivity	to	movements	in	pricing,	and	underlying	accounting	and	business	implications.	To	implement	these	strategies,	we	may	enter	into	various hedging	transactions.	The	sensitivity	analyses	we	present	below	do	not	consider	the	effect	of	possible	adverse	changes	in	the	general	economy,	nor	do they	consider	additional	actions	we	may	take	to	mitigate	our	exposure	to	such	changes.	We	may	not	be	successful	in	managing	these	risks.

# Containerboard	and	Paperboard	Shipments

We	are	exposed	to	market	risk	related	to	our	sales	of	containerboard	and	paperboard.	We	sell	a	significant	portion	of	our	mill	production	and	converted products	pursuant	to	contracts	that	provide	that	prices	are	either	fixed	for	specified	terms	or	provide	for	price	adjustments	based	on	negotiated	terms, including	changes	in	specified	index	prices.	We	have	the	capacity	to	annually	ship	approximately	9.3	million	tons	in	our	Corrugated	Packaging	segment	and approximately	4.2	million	tons	in	our	Consumer	Packaging	segment.	Although	our	mill	system	operating	rates	may	vary	from	year	to	year	due	to	changes	in market	and	other	factors,	our	simple	average	mill	system	operating	rates	for	the	last	three	years	averaged	96%.	A	hypothetical	$10	per	ton	decrease	in	the price	of	containerboard	and	paperboard	throughout	the	year	based	on	our	capacity	would	decrease	our	sales	by	approximately	$93	million	and	$42	million	in our	Corrugated	Packaging	and	Consumer	Packaging	segments,	respectively.	See	Item	1A.	"Risk	Factors	—	Our	Earnings	Are	Highly	Dependent	on Volumes".

Energy	is	one	of	the	most	significant	costs	of	our	mill	operations.	The	cost	of	natural	gas,	coal,	oil,	electricity,	diesel	and	wood	by-products	(biomass)	at times	have	fluctuated	significantly.	In	our	recycled	paperboard	mills,	we	use	primarily	natural	gas	and	electricity,	supplemented	with	coal	and	fuel	oil	to generate	steam	used	in	the	paper	making	process	and,	at	a	few	mills,	to	generate	electricity	used	on	site.	In	our	virgin	fiber	mills,	we	use	biomass,	natural gas	and	coal	to	generate	steam	used	in	the	pulping	and	paper	making	processes	and	to	generate	some	or	all	of	the	electricity	used	on	site.	We	primarily use	electricity	and	natural	gas	to	operate	our	converting	facilities.	We	generally	purchase	these	products	from	suppliers	at	market	or	tariff	rates.

We	spent	approximately	$739	million	on	all	energy	sources	in	fiscal	2018	to	operate	our	facilities.	Natural	gas	accounted	for	nearly	half	(approximately 76	million	MMBtu)	of	our	total	energy	purchases	in	fiscal	2018.	A	hypothetical	10%	increase	in	the	price	of	energy	throughout	the	year	would	increase	our cost	of	energy	by	approximately	$74	million	based	on	fiscal	2018	pricing	and	consumption.

# Recycled	Fiber

Recycled	 fiber	 is	 the	principal	raw	material	we	use	 in the	production	of	recycled	paperboard	and	a	portion	of	our	containerboard.	We	consume approximately	4.8	million	tons	of	recycled	fiber	per	year.	Our	purchases	of	old

corrugated	containers	and	double-lined	kraft	clippings	accounted	for	our	largest	recycled	fiber	costs	and	approximately	85%	to	90%	of	our	recycled	fiber purchases.	The	remaining	10%	to	15%	of	our	recycled	fiber	purchases	consisted	of	a	number	of	other	grades	of	recycled	paper.	The	mix	of	recycled	fiber may	vary	due	to	factors	such	as	market	demand,	availability	and	pricing.	A	hypothetical	10%	increase	in	recycled	fiber	prices	in	our	mills	for	a	fiscal	year would	increase	our	costs	by	approximately	$75	million.

# Virgin	Fiber

Virgin	 fiber	 is	 the	principal	raw	material	we	use	 in	 the	production	of	a	portion	of	our	containerboard,	bleached	paperboard	 and	 market	 pulp.	A hypothetical	10%	increase	in	virgin	fiber	prices	in	our	mills	for	a	fiscal	year	would	increase	our	costs	by	approximately	$117	million.

# Freight

Inbound	and	outbound	freight	is	a	significant	expenditure	for	us.	Factors	that	influence	our	freight	expense	are	items	such	as	distance	between	our shipping	and	delivery	locations,	distance	from	customers	and	suppliers,	mode	of	transportation	(rail,	truck,	intermodal	and	ocean)	and	freight	rates,	which are	influenced	by	supply	and	demand	and	fuel	costs,	primarily	diesel.	We	experienced	significantly	higher	freight	costs	in	fiscal	2018,	as	transportation companies	raised	prices	to	address	a	shortage	of	drivers	and	strong	demand.	A	hypothetical	10%	increase	for	a	fiscal	year	would	increase	our	costs	by approximately	$150	million,	of	which	approximately	one-fifth	would	be	the	portion	related	to	higher	diesel	costs	based	on	our	estimated	77	million	gallons consumed	 annually.	 See Item	 1A.	"Risk	 Factors	 —	 We	 May	 Face Increased	 Costs	 or Inadequate	 Availability	 of	 Raw	 Materials,	 Energy	 and Transportation".

# Interest	Rates

We	are	exposed	to	changes	in	interest	rates,	primarily	as	a	result	of	our	short-term	and	long-term	debt.	We	may	from	time	to	time	use	interest	rate swap	agreements	to	manage	the	interest	rate	characteristics	of	a	portion	of	our	outstanding	debt.	Based	on	the	amounts	and	mix	of	our	fixed	and	floating rate	 debt	 at	 September	 30,	 2018,	 if	 market	 interest	 rates	 increase	 an	 average	 of	 100	 basis	 points,	 our	 annual	 interest	 expense	 would	 increase	 by approximately	$10	million.	We	determined	these	amounts	by	considering	the	impact	of	the	hypothetical	interest	rates	on	our	borrowing	costs.	This	analysis does	not	consider	the	effects	of	changes	in	the	level	of	overall	economic	activity	that	could	exist	in	such	an	environment.	See	Item	1A.	"Risk	Factors	— The	Level	of	Our	Indebtedness	Could	Adversely	Affect	Our	Financial	Condition	and	Impair	Our	Ability	to	Operate	Our	Business".

# Derivative	Instruments	/	Forward	Contracts

We	periodically	may	issue	and	settle	foreign	currency	denominated	debt,	exposing	us	to	the	effect	of	changes	in	spot	exchange	rates	between	loan issue	and	loan	repayment	dates	and	changes	in	spot	exchange	rates	on	open	balances	at	each	balance	sheet	date.	From	time	to	time,	we	may	use	foreign exchange	contracts	to	hedge	these	exposures	with	terms	of	generally	one	month.	Based	on	our	open	foreign	exchange	contracts	as	of	September	30,	2018, the	effect	of	a	1%	change	in	exchange	rates	would	impact	other	income	by	approximately	$4	million.	Although	these	foreign	currency	sensitive	instruments expose	us	to	market	risk,	fluctuations	in	the	value	of	these	instruments	are	mitigated	by	expected	offsetting	fluctuations	in	the	foreign	currency	denominated debt	exposures.	The	fluctuation	of	these	instruments	may	cause	future	cash	settlement	of	the	hedge.

# Pension	Plans

Our	pension	plans	are	influenced	by	trends	in	the	financial	markets	and	the	regulatory	environment,	among	other	factors.	Adverse	general	stock market	trends	and	falling	interest	rates	increase	plan	costs	and	liabilities.	During	fiscal	2018,	the	effect	of	a	0.25%	decrease	in	the	discount	rate	would	have reduced	pre-tax	income	by	approximately	$11	million	and	a	0.25%	increase	in	the	discount	rate	would	have	increased	pre-tax	income	by	$11	million.	During fiscal	2017,	the	effect	of	a	0.25%	decrease	in	the	discount	rate	would	have	reduced	pre-tax	income	by	approximately	$11	million	and	a	0.25%	increase	in the	discount	rate	would	have	increased	pre-tax	income	by	$8	million.	Similarly,	MEPPs	in	which	we	participate	could	experience	similar	circumstances which	 could	 impact	 our	 funding	 requirements	 and	 therefore	 expenses.	 See	"Note	 4.	 Retirement	 Plans	 —	 Multiemployer	 Plans "	 of	 the	 Notes	 to Consolidated	 Financial	 Statements.	 See	 also Item	 1A. "Risk	 Factors	 —Certain	 of	 Our	 Pension	 Plans	 Will	 Likely	 Require	 Additional	 Cash Contributions"	and	"Risk	Factors	—	We	May	Incur	Withdrawal	Liability	and/or	Increased	Funding	Requirements	in	Connection	with	the	MEPPs	in Which	We	Participate".

# Foreign	Currency

We	predominately	operate	in	U.S.	markets,	but	derived	19.9%	of	our	net	sales	in	fiscal	2018	from	outside	the	U.S.	through	international	operations, some	of	which	were	transacted	in	U.S.	dollars.	In	addition,	certain	of	our	domestic	operations	have	sales	to	foreign	customers.	In	conducting	our	foreign operations,	we	also	make	inter-company	sales	and	receive	royalties	and	dividends	denominated	in	different	currencies.	These	activities	expose	us	to	the effect	of	changes	in	foreign	currency	exchange	rates.	Flows	of	foreign	currencies	into	and	out	of	our	operations	are	generally	stable	and	regularly	occurring and	are	recorded	at	fair	market	value	in	our	financial	statements.	Our	foreign	currency	management	policy	permits	us	to	enter	into	foreign	currency	hedges when	these	flows	exceed	a	threshold,	which	is	a	function	of	these	cash	flows	and	forecasted	annual	operations.

At	times,	certain	of	our	foreign	subsidiaries	have	U.S.	dollar-denominated	external	debt.	In	these	instances,	we	may	hedge	the	non-functional	currency exposure	with	derivatives.	We	 issue	 inter-company	 loans	 to	and	receive	 foreign	cash	deposits	 from	our	 foreign	subsidiaries	 in	 their	 local	currencies, exposing	us	to	the	effect	of	changes	in	spot	exchange	rates	between	loan	issue	and	loan	repayment	dates	and	changes	in	spot	exchange	rates	from deposits.	From	time	to	time,	we	may	use	foreign-exchange	hedge	contracts	with	terms	of	generally	less	than	one	year	to	hedge	these	exposures.	Although our	derivative	and	other	foreign	currency	sensitive	instruments	expose	us	to	market	risk,	fluctuations	in	the	value	of	these	instruments	are	mitigated	by expected	offsetting	fluctuations	in	the	matched	exposures.

During	fiscal	2018	and	2017,	the	effect	of	a	hypothetical	10%	change	in	foreign	currencies	that	we	have	exposure	to	versus	to	the	U.S.	dollar	would have	 impacted	 our	 segment	 results	 by	 approximately	 $36	 million	 and	 $26	 million,	 respectively.	 See	"Note	6.	Segment Information"	of the	Notes	 to Consolidated	Financial	Statements	for	additional	information.

During	 fiscal	2018	and	2017,	 the	effect	of	a	1%	change	 in	exchange	rates	would	have	 impacted	accumulated	other	comprehensive	 income	by approximately	$37	million	and	$34	million,	respectively.	This	impact	does	not	consider	the	effects	of	a	stronger	or	weaker	dollar	on	our	ability	to	compete	for export	business	or	the	overall	economic	activity	that	could	exist	in	such	an	environment.	Changes	in	foreign	exchange	rates	could	impact	the	price	and	the demand	for	our	products.	See	Item	1A.	"Risk	Factors	—	We	May	Be	Adversely	Affected	by	Factors	That	Are	Beyond	Our	Control,	Such	as	U.S.	and Worldwide	Economic	and	Financial	Market	Conditions,	and	Social	and	Political	Change".

# Item	8. FINANCIAL	STATEMENTS	AND	SUPPLEMENTARY	DATA

# Index	to	Financial	Statements

|  | Page |
| :--- | :--- |
| Description | Reference |
| Consolidated\tStatements\tof\tOperations | 59 |
| Consolidated\tStatements\tof\tComprehensive\tIncome\t(Loss) | 60 |
| Consolidated\tBalance\tSheets | 61 |
| Consolidated\tStatements\tof\tEquity | 62 |
| Consolidated\tStatements\tof\tCash\tFlows | 64 |
| Notes\tto\tConsolidated\tFinancial\tStatements | 66 |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm | 134 |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm\ton\tInternal\tControl\tOver\tFinancial\tReporting | 135 |
| Management's\tAnnual\tReport\ton\tInternal\tControl\tOver\tFinancial\tReporting | 137 |

Financial	Statements.

# CONSOLIDATED	STATEMENTS	OF	OPERATIONS

| (In	millions,	except	per	share	data) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales | $16,285.1 | $14,859.7 | $14,171.8 |
| Cost\tof\tgoods\tsold | 12,891.2 | 12,119.5 | 11,413.2 |
| Selling,\tgeneral\tand\tadministrative,\texcluding\tintangible |  |  |  |
| \t\t\tamortization | 1,493.3 | 1,399.6 | 1,379.4 |
| Selling,\tgeneral\tand\tadministrative\tintangible\tamortization | 296.6 | 229.6 | 211.8 |
| Multiemployer\tpension\twithdrawals | 184.2 | — | — |
| Pension\trisk\ttransfer\texpense | — | — | 370.7 |
| Pension\tlump\tsum\tsettlement | — | 32.6 | — |
| Land\tand\tDevelopment\timpairments | 31.9 | 46.7 | — |
| Restructuring\tand\tother\tcosts | 105.4 | 196.7 | 366.4 |
| Operating\tprofit | 1,282.5 | 835.0 | 430.3 |
| Interest\texpense,\tnet | (293.8) | (222.5) | (212.5) |
| (Loss)\tgain\ton\textinguishment\tof\tdebt | (0.1) | 1.8 | 2.7 |
| Other\tincome,\tnet | 12.7 | 11.5 | 14.4 |
| Equity\tin\tincome\tof\tunconsolidated\tentities | 33.5 | 39.0 | 9.7 |
| Gain\ton\tsale\tof\tHH&amp;B | — | 192.8 | — |
| Income\tfrom\tcontinuing\toperations\tbefore\tincome\ttaxes | 1,034.8 | 857.6 | 244.6 |
| Income\ttax\tbenefit\t(expense) | 874.5 | (159.0) | (89.8) |
| Income\tfrom\tcontinuing\toperations | 1,909.3 | 698.6 | 154.8 |
| Loss\tfrom\tdiscontinued\toperations\t(net\tof\tincome\ttax |  |  |  |
| \t\t\tbenefit\tof\t$0,\t$0\tand\t$32.3) | — | — | (544.7) |
| Consolidated\tnet\tincome\t(loss) | 1,909.3 | 698.6 | (389.9) |
| Less:\tNet\t(income)\tloss\tattributable\tto\tnoncontrolling |  |  |  |
| \t\t\tinterests | (3.2) | 9.6 | (6.4) |
| Net\tincome\t(loss)\tattributable\tto\tcommon\tstockholders | $1,906.1 | $708.2 | $(396.3) |
| Basic\tearnings\tper\tshare\tfrom\tcontinuing\toperations | $7.46 | $2.81 | $0.60 |
| Basic\tloss\tper\tshare\tfrom\tdiscontinued\toperations | — | — | (2.16) |
| Basic\tearnings\t(loss)\tper\tshare\tattributable\tto\tcommon\n\t\t\tstockholders | $7.46 | $2.81 | $(1.56) |
| Diluted\tearnings\tper\tshare\tfrom\tcontinuing\toperations | $7.34 | $2.77 | $0.59 |
| Diluted\tloss\tper\tshare\tfrom\tdiscontinued\toperations | — | — | (2.13) |
| Diluted\tearnings\t(loss)\tper\tshare\tattributable\tto\tcommon |  |  |  |
| \t\t\tstockholders | $7.34 | $2.77 | $(1.54) |
| Cash\tdividends\tpaid\tper\tshare | $1.72 | $1.60 | $1.50 |

# CONSOLIDATED	STATEMENTS	OF	COMPREHENSIVE	INCOME	(LOSS)

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Consolidated\tnet\tincome\t(loss) | $1,909.3 | $698.6 | $(389.9) |
| Other\tcomprehensive\t(loss)\tincome,\tnet\tof\ttax: |  |  |  |
| Foreign\tcurrency: |  |  |  |
| Foreign\tcurrency\ttranslation\t(loss)\tgain | (234.4) | 80.7 | 109.8 |
| Reclassification\tadjustment\tof\tnet\tloss\ton\tforeign\tcurrency |  |  |  |
| \t\t\ttranslation\tincluded\tin\tearnings | — | — | 20.2 |
| Sale\tof\tHH&amp;B | — | 26.8 | — |
| Derivatives: |  |  |  |
| Deferred\tloss\ton\tcash\tflow\thedges | — | — | (0.4) |
| Reclassification\tadjustment\tof\tnet\tloss\t(gain)\ton\tcash |  |  |  |
| \t\t\tflow\thedges\tincluded\tin\tearnings | 0.5 | (0.5) | 1.2 |
| Unrealized\tgain\ton\tavailable\tfor\tsale\tsecurity | 0.8 | 0.7 | — |
| Reclassification\tadjustment\tof\tgain\ton\tavailable\tfor |  |  |  |
| \t\t\tsale\tsecurity\tincluded\tin\tearnings | (1.5) | — | — |
| Defined\tbenefit\tpension\tand\tother\tpostretirement\tbenefit |  |  |  |
| \t\t\tplans: |  |  |  |
| Net\tactuarial\t(loss)\tgain\tarising\tduring\tperiod | (13.1) | 22.2 | (224.6) |
| Amortization\tand\tsettlement\trecognition\tof\tnet |  |  |  |
| \t\t\tactuarial\tloss,\tincluded\tin\tpension\tand |  |  |  |
| \t\t\tpostretirement\tcost\t(1) | 15.0 | 36.0 | 236.5 |
| Prior\tservice\t(cost)\tcredit\tarising\tduring\tperiod | (5.5) | 0.7 | 1.4 |
| Amortization\tand\tcurtailment\trecognition\tof\tprior |  |  |  |
| \t\t\tservice\tcost\t(credit),\tincluded\tin\tpension\tand |  |  |  |
| \t\t\tpostretirement\tcost | 0.2 | (0.2) | 1.1 |
| Sale\tof\tHH&amp;B | — | 2.9 | — |
| Other\tcomprehensive\t(loss)\tincome,\tnet\tof\ttax | (238.0) | 169.3 | 145.2 |
| Comprehensive\tincome\t(loss) | 1,671.3 | 867.9 | (244.7) |
| Less:\tComprehensive\t(income)\tloss\tattributable\tto |  |  |  |
| \t\t\tnoncontrolling\tinterests | (3.2) | 9.4 | (5.7) |
| Comprehensive\tincome\t(loss)\tattributable\tto\tcommon\n\t\t\tstockholders | $1,668.1 | $877.3 | $(250.4) |

(1) Fiscal	2016	includes	pension	risk	transfer	expense,	net	of	tax.

See	Accompanying	Notes

# CONSOLIDATED	BALANCE	SHEETS

| (In	millions,	except	per	share	data) | September	30,<br>2018 | 2017 |
| :--- | :--- | :--- |
| ASSETS |  |  |
| Current\tAssets: |  |  |
| Cash\tand\tcash\tequivalents | $636.8 | $298.1 |
| Restricted\tcash | — | 5.9 |
| Accounts\treceivable\t(net\tof\tallowances\tof\t$49.7\tand\t$45.8) | 2,010.7 | 1,886.8 |
| Inventories | 1,829.6 | 1,797.3 |
| Other\tcurrent\tassets | 248.5 | 329.2 |
| Assets\theld\tfor\tsale | 59.5 | 173.6 |
| Total\tcurrent\tassets | 4,785.1 | 4,490.9 |
| Property,\tplant\tand\tequipment,\tnet | 9,082.5 | 9,118.3 |
| Goodwill | 5,577.6 | 5,528.3 |
| Intangibles,\tnet | 3,122.0 | 3,329.3 |
| Restricted\tassets\theld\tby\tspecial\tpurpose\tentities | 1,281.0 | 1,287.4 |
| Prepaid\tpension\tasset | 420.0 | 368.0 |
| Other\tassets | 1,092.3 | 966.8 |
| Total\tAssets | $25,360.5 | $25,089.0 |
| LIABILITIES\tAND\tEQUITY |  |  |
| Current\tliabilities: |  |  |
| Current\tportion\tof\tdebt | $740.7 | $608.7 |
| Accounts\tpayable | 1,716.8 | 1,492.1 |
| Accrued\tcompensation\tand\tbenefits | 399.3 | 416.7 |
| Other\tcurrent\tliabilities | 476.5 | 492.3 |
| Total\tcurrent\tliabilities | 3,333.3 | 3,009.8 |
| Long-term\tdebt\tdue\tafter\tone\tyear | 5,674.5 | 5,946.1 |
| Pension\tliabilities,\tnet\tof\tcurrent\tportion | 261.3 | 279.4 |
| Postretirement\tbenefit\tliabilities,\tnet\tof\tcurrent\tportion | 134.8 | 153.4 |
| Non-recourse\tliabilities\theld\tby\tspecial\tpurpose\tentities | 1,153.7 | 1,161.9 |
| Deferred\tincome\ttaxes | 2,321.5 | 3,410.2 |
| Other\tlong-term\tliabilities | 994.8 | 737.4 |
| Commitments\tand\tcontingencies\t(Notes\t14\tand\t17) |  |  |
| Redeemable\tnoncontrolling\tinterests | 4.2 | 4.7 |
| Equity: |  |  |
| Preferred\tstock,\t$0.01\tpar\tvalue;\t30.0\tmillion\tshares\tauthorized;\tno |  |  |
| \t\t\tshares\toutstanding | — | — |
| Common\tstock,\t$0.01\tpar\tvalue;\t600.0\tmillion\tshares\tauthorized; |  |  |
| \t\t\t253.5\tmillion\tand\t254.5\tmillion\tshares\toutstanding\tat\tSeptember |  |  |
| \t\t\t30,\t2018\tand\tSeptember\t30,\t2017,\trespectively | 2.5 | 2.5 |
| Capital\tin\texcess\tof\tpar\tvalue | 10,588.9 | 10,624.9 |
| Retained\tearnings | 1,573.3 | 172.4 |
| Accumulated\tother\tcomprehensive\tloss | (695.3) | (457.3) |
| Total\tstockholders'\tequity | 11,469.4 | 10,342.5 |
| Noncontrolling\tinterests | 13.0 | 43.6 |
| Total\tequity | 11,482.4 | 10,386.1 |
| Total\tLiabilities\tand\tEquity | $25,360.5 | $25,089.0 |

# CONSOLIDATED	STATEMENTS	OF	EQUITY

| (In	millions,	except	per	share	data) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Number\tof\tShares\tof\tCommon\tStock\tOutstanding: |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | 254.5 | 251.0 | 257.0 |
| Shares\tissued\tunder\trestricted\tstock\tplan | 0.7 | 1.1 | 1.6 |
| Issuance\tof\tcommon\tstock,\tnet\tof\tstock\treceived\tfor\tminimum\ttax |  |  |  |
| \t\t\twithholdings\t(1)\t(2) | 1.7 | 4.2 | 0.5 |
| Purchases\tof\tcommon\tstock\t(3) | (3.4) | (1.8) | (8.1) |
| Balance\tat\tend\tof\tfiscal\tyear | 253.5 | 254.5 | 251.0 |
| Common\tStock: |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | $2.5 | $2.5 | $2.6 |
| Issuance\tof\tcommon\tstock,\tnet\tof\tstock\treceived\tfor\tminimum\ttax |  |  |  |
| \t\t\twithholdings\t(1) | — | — | — |
| Purchases\tof\tcommon\tstock\t(3) | — | — | (0.1) |
| Balance\tat\tend\tof\tfiscal\tyear | 2.5 | 2.5 | 2.5 |
| Capital\tin\tExcess\tof\tPar\tValue: |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | 10,624.9 | 10,458.6 | 10,767.8 |
| Income\ttax\tbenefit\t(expense)\tfrom\tshare-based\tplans | — | 4.3 | (15.5) |
| Compensation\texpense\tunder\tshare-based\tplans | 66.9 | 60.6 | 76.0 |
| Issuance\tof\tcommon\tstock,\tnet\tof\tstock\treceived\tfor\tminimum\ttax |  |  |  |
| \t\t\twithholdings\t(1) | 38.9 | 181.6 | 13.9 |
| Fair\tvalue\tof\tshare-based\tawards\tissued\tin\tbusiness\tcombinations | — | 1.9 | — |
| Purchases\tof\tcommon\tstock\t(3) | (141.8) | (76.3) | (319.2) |
| Separation\tof\tSpecialty\tChemicals\tbusiness | — | (5.8) | (64.4) |
| Balance\tat\tend\tof\tfiscal\tyear | 10,588.9 | 10,624.9 | 10,458.6 |
| Retained\tEarnings\t(Deficit): |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | 172.4 | (105.9) | 1,661.6 |
| Net\tincome\t(loss)\tattributable\tto\tcommon\tstockholders | 1,906.1 | 708.2 | (396.3) |
| Dividends\tdeclared\t(per\tshare\t-\t$1.72,\t$1.60\tand\t$1.50)\t(4) | (445.2) | (407.3) | (384.2) |
| Issuance\tof\tcommon\tstock,\tnet\tof\tstock\treceived\tfor\tminimum\ttax |  |  |  |
| \t\t\twithholdings | (6.7) | (5.9) | (0.8) |
| Purchases\tof\tcommon\tstock\t(3) | (53.3) | (16.7) | (16.0) |
| Separation\tof\tSpecialty\tChemicals\tbusiness | — | — | (970.2) |
| Balance\tat\tend\tof\tfiscal\tyear | 1,573.3 | 172.4 | (105.9) |
| Accumulated\tOther\tComprehensive\tLoss: |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | (457.3) | (626.4) | (780.2) |
| Other\tcomprehensive\t(loss)\tincome,\tnet\tof\ttax | (238.0) | 169.1 | 145.9 |
| Separation\tof\tSpecialty\tChemicals\tbusiness | — | — | 7.9 |
| Balance\tat\tend\tof\tfiscal\tyear | (695.3) | (457.3) | (626.4) |
| Total\tStockholders'\tequity | 11,469.4 | 10,342.5 | 9,728.8 |
| Noncontrolling\tInterests:\t(5) |  |  |  |
| Balance\tat\tbeginning\tof\tfiscal\tyear | 43.6 | 101.2 | 132.1 |
| Noncontrolling\tinterests\tassumed\tin\tbusiness\tcombinations | — | — | 10.9 |
| Net\tincome\t(loss) | 2.1 | (12.9) | 3.2 |
| Contributions | 0.5 | — | — |
| Distributions\tand\tadjustments\tto\tnoncontrolling\tinterests | (33.2) | (44.7) | (18.7) |
| Sale\tof\tsubsidiary\tshares\tfrom\tnoncontrolling\tinterest | — | — | (0.2) |
| Other\tcomprehensive\tincome\tattributable\tto\tnoncontrolling\tinterest | — | — | — |
| Separation\tof\tSpecialty\tChemicals\tbusiness | — | — | (26.1) |
| Balance\tat\tend\tof\tfiscal\tyear | 13.0 | 43.6 | 101.2 |
| Total\tequity | $11,482.4 | $10,386.1 | $9,830.0 |

(1) Included	 in	 the	 issuance	of	common	stock	 in fiscal	2017 is the issuance	of	approximately	2.4	million	shares	of	Common	Stock	valued	at	$136.1	million in connection	with	the	U.S.	Corrugated	Acquisition.

(2) In	connection	with	the	Smurfit-Stone	Acquisition,	there	were	approximately	1.4	million	shares	reserved	but	unissued	at	the	time	of	the	acquisition	for	the	resolution of	Smurfit-Stone	bankruptcy	claims.	At	September	30,	2017,	0.2	million	shares

remain	reserved	and	unissued.	The	remaining	shares	were	issued	in	fiscal	2018	as	the	claim's	distribution	process	was	completed.

(3) In	fiscal	2018,	we	repurchased	approximately	3.4	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$195.1	million.	In	fiscal	2017,	we	repurchased approximately	1.8	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$93.0	million.	In	fiscal	2016,	we	repurchased	approximately	8.1	million	shares	of our	Common	Stock	for	an	aggregate	cost	of	$335.3	million.

(4) Includes	cash	dividends	paid,	dividend	equivalent	units	on	certain	restricted	stock	awards	and	dividends	declared	but	unpaid	related	to	the	shares	reserved	but unissued	at	the	time	of	the	acquisition	for	the	resolution	of	Smurfit-Stone	bankruptcy	claims.

(5) Excludes	amounts	related	to	contingently	redeemable	noncontrolling	interests,	which	are	separately	classified	outside	of	permanent	equity	in	the	Consolidated Balance	Sheets.

# CONSOLIDATED	STATEMENTS	OF	CASH	FLOWS

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Operating\tactivities: |  |  |  |
| Consolidated\tnet\tincome\t(loss) | $1,909.3 | $698.6 | $(389.9) |
| Adjustments\tto\treconcile\tconsolidated\tnet\tincome\tto\tnet\tcash |  |  |  |
| \t\t\tprovided\tby\toperating\tactivities: |  |  |  |
| Depreciation,\tdepletion\tand\tamortization | 1,252.2 | 1,112.1 | 1,141.9 |
| Cost\tof\treal\testate\tsold | 121.2 | 207.9 | 87.7 |
| Deferred\tincome\ttax\tbenefit | (1,069.4) | (20.4) | (160.9) |
| Share-based\tcompensation\texpense | 66.8 | 58.0 | 75.7 |
| Pension\tand\tother\tpostretirement\tfunding\t(more)\tthan\texpense |  |  |  |
| \t\t\t(income) | (96.8) | (51.0) | 275.6 |
| Multiemployer\tpension\twithdrawals | 184.2 | — | — |
| Gain\ton\tsale\tof\tHH&amp;B | — | (192.8) | — |
| Land\tand\tDevelopment\timpairments | 31.9 | 46.7 | — |
| Other\timpairment\tadjustments | 13.5 | 56.8 | 200.8 |
| Impairment\tof\tSpecialty\tChemicals\tgoodwill\tand\tintangibles | — | — | 579.4 |
| Other | (85.5) | (92.2) | (87.1) |
| Change\tin\toperating\tassets\tand\tliabilities,\tnet\tof\tacquisitions\tand |  |  |  |
| \t\t\tdivestitures: |  |  |  |
| Accounts\treceivable | (143.4) | (97.9) | 36.6 |
| Inventories | (72.1) | (48.2) | 50.6 |
| Other\tassets | (22.6) | (33.7) | (92.7) |
| Accounts\tpayable | 180.3 | 302.2 | (197.1) |
| Income\ttaxes | 130.6 | (67.1) | 73.2 |
| Accrued\tliabilities\tand\tother | 20.7 | 21.5 | 94.6 |
| Net\tcash\tprovided\tby\toperating\tactivities | 2,420.9 | 1,900.5 | 1,688.4 |
| Investing\tactivities: |  |  |  |
| Capital\texpenditures | (999.9) | (778.6) | (796.7) |
| Cash\tpaid\tfor\tpurchase\tof\tbusinesses,\tnet\tof\tcash\tacquired | (239.9) | (1,588.5) | (376.4) |
| Debt\tpurchased\tin\tconnection\twith\tan\tacquisition | — | — | (36.5) |
| Investment\tin\tunconsolidated\tentities | (114.3) | (2.5) | (179.9) |
| Proceeds\tfrom\tsale\tof\tHH&amp;B | — | 1,005.9 | — |
| Proceeds\tfrom\tsale\tof\tproperty,\tplant\tand\tequipment | 23.3 | 52.6 | 31.2 |
| Other | 31.9 | 25.3 | 6.9 |
| Net\tcash\tused\tfor\tinvesting\tactivities | (1,298.9) | (1,285.8) | (1,351.4) |
| Financing\tactivities: |  |  |  |
| Proceeds\tfrom\tissuance\tof\tnotes | 1,197.3 | 998.4 | — |
| (Repayments)\tadditions\tto\trevolving\tcredit\tfacilities | (115.5) | 421.8 | 125.5 |
| Additions\tto\tdebt | 855.2 | 742.6 | 1,511.8 |
| Repayments\tof\tdebt | (2,032.9) | (2,331.9) | (1,073.3) |
| Other\tfinancing\t(repayments)\tadditions | (24.2) | 23.9 | 53.3 |
| Specialty\tChemicals\tspin-off\tof\tnet\tcash\tand\ttrust\tfunding | — | — | (105.0) |
| Issuances\tof\tcommon\tstock,\tnet\tof\trelated\tminimum\ttax\twithholdings | 26.6 | 35.8 | 11.8 |
| Purchases\tof\tcommon\tstock | (195.1) | (93.0) | (335.3) |
| Cash\tdividends\tpaid\tto\tstockholders | (440.9) | (403.2) | (380.7) |
| Cash\tdistributions\tpaid\tto\tnoncontrolling\tinterests | (33.3) | (47.0) | (33.5) |
| Other | 7.7 | (2.8) | (5.6) |
| Net\tcash\tused\tfor\tfinancing\tactivities | (755.1) | (655.4) | (231.0) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | (28.2) | (2.1) | 6.6 |
| Increase\t(decrease)\tin\tcash\tand\tcash\tequivalents | 338.7 | (42.8) | 112.6 |
| Cash\tand\tcash\tequivalents\tat\tbeginning\tof\tperiod\t(2016\tincludes |  |  |  |
| \t\t\t\t$20.5\tfrom\tdiscontinued\toperations) | 298.1 | 340.9 | 228.3 |
| Cash\tand\tcash\tequivalents\tat\tend\tof\tperiod | $636.8 | $298.1 | $340.9 |

Supplemental	disclosure	of	cash	flow	information:

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Cash\tpaid\tduring\tthe\tperiod\tfor: |  |  |  |
| Income\ttaxes,\tnet\tof\trefunds | $60.5 | $227.6 | $157.4 |
| Interest,\tnet\tof\tamounts\tcapitalized | $284.4 | $239.0 | $229.9 |

Supplemental	schedule	of	non-cash	operating	and	investing	activities:

In	 fiscal	 2017,	 we	 contributed	 a	 subsidiary	 to	 an	 unconsolidated	 joint	 venture	 and	 deconsolidated	 another	 subsidiary	 which	 resulted	 in	 the derecognition	and	recognition	of	certain	non-cash	items.	In	connection	with	the	formation	of	the	Grupo	Gondi	joint	venture	in	fiscal	2016,	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%	equity	participation	in	the joint	venture	and	options	valued	at	approximately	$0.3	billion.	The	entity	was	deconsolidated	as	of	April	1,	2016,	which	resulted	in	the	derecognition	and recognition	of	the	following	non-cash	items	for	the	year	ended	September	30:

| (In	millions) | 2017 | 2016 |
| :--- | :--- | :--- |
| Derecognized: |  |  |
| Accounts\treceivable | $14.6 | $34.7 |
| Inventories | $7.6 | $25.8 |
| Other\tassets | $12.3 | $86.3 |
| Accounts\tpayable | $(7.9) | $(15.4) |
| Income\ttaxes | $(1.4) | $(1.0) |
| Accrued\tliabilities\tand\tother | $(12.0) | $(18.8) |
| Recognized:\nInvestment\tin\tunconsolidated\tentities | $(16.7) | $(123.7) |

Supplemental	schedule	of	non-cash	investing	and	financing	activities:

Liabilities	assumed	in	fiscal	2018	primarily	relate	to	the	Plymouth	Packaging	Acquisition	and	the	Schlüter	Acquisition.	Liabilities	assumed	in	fiscal	2017 relate	to	the	MPS	Acquisition,	the	U.S.	Corrugated	Acquisition,	the	Island	Container	Acquisition,	the	Hannapak	Acquisition	and	the	Star	Pizza	Acquisition. Liabilities	assumed	in	fiscal	2016	relate	to	the	SP	Fiber	Acquisition	and	the	Packaging	Acquisition.	See	"Note	2.	Mergers,	Acquisitions	and	Investment " for	additional	information.

| (In	millions) | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Fair\tvalue\tof\tassets\tacquired,\tincluding\tgoodwill | $303.2 | $3,342.4 | $580.7 |
| Cash\tconsideration\tfor\tthe\tpurchase\tof\tbusinesses,\tnet\tof\tcash |  |  |  |
| \t\t\tacquired | (242.1) | (1,592.0) | (376.4) |
| Stock\tissued\tin\tbusiness\tcombinations | — | (136.1) | — |
| Fair\tvalue\tof\tshare-based\tawards\tissued\tin\tbusiness |  |  |  |
| \t\t\tcombinations | — | (1.9) | — |
| Debt\tpurchased\tin\tconnection\twith\tan\tacquisition | — | — | (36.5) |
| Deferred\tpayments\tand\t(unpaid)\tunreceived\tworking\tcapital\tor\tescrow | (25.0) | 4.6 | 3.5 |
| Liabilities\tand\tnoncontrolling\tinterest\tassumed | $36.1 | $1,617.0 | $171.3 |
| Included\tin\tliabilities\tassumed\tis\tthe\tfollowing\titem:\nDebt\tassumed | $7.5 | $929.1 | $15.0 |

# NOTES	TO	CONSOLIDATED	FINANCIAL	STATEMENTS

# Note	1. Description	of	Business	and	Summary	of	Significant	Accounting	Policies

# Description	of	Business

WestRock	was	formed	on	March	6,	2015	for	the	purpose	of	effecting	the	Combination	and,	prior	to	the	Combination,	did	not	conduct	any	activities other	than	those	incidental	to	its	formation	and	the	matters	contemplated	by	the	Business	Combination	Agreement.	On	July	1,	2015,	pursuant	to	the Business	Combination	Agreement,	RockTenn	and	MWV	completed	a	strategic	combination	of	their	respective	businesses	and	RockTenn	and	MWV	each became	wholly-owned	subsidiaries	of	WestRock.	RockTenn	was	the	accounting	acquirer	in	the	Combination.	See	"Note	2.	Mergers,	Acquisitions	and Investment"	for	additional	information.

On	May	15,	2016,	WestRock	completed	the	Separation,	pursuant	to	which	we	disposed	of	our	former	Specialty	Chemicals	segment	in	its	entirety	and ceased	to	consolidate	its	assets,	liabilities	and	results	of	operations	in	our	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	consolidated	 financial statements	for	all	periods	presented.	See	"Note	7.	Discontinued	Operations"	for	additional	information.

During	 the	second	quarter	of	 fiscal	2017,	we	committed	 to	a	plan	 to	sell	HH&B.	On	January	23,	2017,	we	announced	we	had	entered	 into	an agreement	with	certain	subsidiaries	of	Silgan	Holdings	Inc.	("Silgan")	under	which	Silgan	would	purchase	HH&B	for	approximately	$1.025	billion	in	cash plus	the	assumption	of	approximately	$25	million	in	foreign	pension	liabilities.	Accordingly,	in	the	second	quarter	of	fiscal	2017,	all	of	the	assets	and liabilities	of	HH&B	were	reported	as	assets	and	liabilities	held	for	sale.	We	discontinued	recording	depreciation	and	amortization	while	the	assets	were	held for	sale.	On	April	6,	2017,	we	announced	that	we	had	completed	the	HH&B	Sale.	We	used	the	proceeds	from	the	HH&B	Sale	in	connection	with	the	MPS Acquisition.	We	recorded	a	pre-tax	gain	on	sale	of	HH&B	of	$192.8	million	in	fiscal	2017.

On	June	6,	2017,	we	completed	the	MPS	Acquisition.	MPS	is	a	global	provider	of	print-based	specialty	packaging	solutions	and	its	differentiated product	offering	includes	premium	folding	cartons,	inserts,	labels	and	rigid	packaging.	MPS	is	reported	in	our	Consumer	Packaging	segment.	See	"Note	2.

# Mergers,	Acquisitions	and	Investment"	for	additional	information.

# Consolidation

The	consolidated	financial	statements	include	our	accounts	and	the	accounts	of	our	partially-owned	consolidated	subsidiaries.	Equity	investments	in which	we	exercise	significant	influence	but	do	not	control	and	are	not	the	primary	beneficiary	are	accounted	for	using	the	equity	method.	Investments	in which	we	are	not	able	to	exercise	significant	influence	over	the	investee	are	accounted	for	under	the	cost	method.	Our	equity	and	cost	method	investments are	not	significant	either	individually	or	in	the	aggregate.	We	have	eliminated	all	significant	intercompany	accounts	and	transactions.	See	"Note	6.	Segment Information"	for	our	equity	method	investments.

# NOTES	TO	CONSOLIDATED	FINANCIAL	STATEMENTS	—	(Continued)

# Reclassifications

During	fiscal	2018,	we	presented	our	interest	expense	and	interest	income	in	a	single	line	item,	"interest	expense,	net",	in	our	consolidated	statements of	operations.	The	interest	income	was	previously	presented	in	the	line	item	"interest	income	and	other	income	(expense),	net",	which	is	now	presented	as "other	income,	net".	The	presentation	of	these	two	line	items	for	fiscal	2017	and	2016	has	been	changed	to	conform	to	the	current	year	presentation.	In addition,	we	have	excluded	deferred	financing	costs	from	the	line	item	depreciation,	depletion	and	amortization	on	the	consolidated	statements	of	cash flows	to	conform	with	our	current	year	presentation	and	have	aggregated	certain	items	into	an	"other'	caption	in	the	operating,	investing	and	financing activities	sections	of	the	consolidated	statements	of	cash	flows	to	conform	with	our	current	year	presentation.

# Use	of	Estimates

Preparing	consolidated	financial	statements	in	conformity	with	GAAP	requires	us	to	make	estimates	and	assumptions	that	affect	the	reported	amounts of	assets	and	liabilities	and	disclosure	of	contingent	assets	and	liabilities	at	the	date	of	the	consolidated	financial	statements	and	the	reported	amounts	of revenues	and	expenses	during	the	reporting	period.	Actual	results	may	differ	from	those	estimates,	and	the	differences	could	be	material.

The	most	significant	accounting	estimates	 inherent	 in	 the	preparation	of	our	consolidated	 financial	statements	 include	estimates	 to	evaluate	 the recoverability	of	goodwill,	intangibles	and	property,	plant	and	equipment,	to	determine	the	useful	lives	of	assets	that	are	amortized	or	depreciated,	and	to measure	income	taxes,	self-insured	obligations,	restructuring	activities	and	allocate	the	purchase	price	of	an	acquired	business	to	the	fair	value	of	acquired assets	 and	 liabilities.	 In	 addition,	 significant	 estimates	 form	 the	 basis	 for	 our	 reserves	 with	 respect	 to	 collectability	 of	 accounts	 receivable,	 inventory valuations,	pension	benefits,	deferred	tax	asset	valuation	allowances	and	certain	benefits	provided	to	current	and	retired	employees.	Various	assumptions and	other	factors	underlie	the	determination	of	these	significant	estimates.	The	process	of	determining	significant	estimates	is	fact	specific	and	takes	into account	 factors	such	as	historical	experience,	current	and	expected	economic	conditions,	product	mix,	and	 in	some	cases,	actuarial	 techniques.	We regularly	evaluate	these	significant	factors	and	make	adjustments	where	facts	and	circumstances	dictate.

# Revenue	Recognition

We	recognize	revenue	when	there	is	persuasive	evidence	that	an	arrangement	exists,	delivery	has	occurred	or	services	have	been	rendered,	our	price to	the	buyer	is	fixed	or	determinable	and	collectability	is	reasonably	assured.	Delivery	is	not	considered	to	have	occurred	until	the	customer	takes	title	and assumes	the	risks	and	rewards	of	ownership.	The	timing	of	revenue	recognition	is	dependent	on	the	location	of	title	transfer	which	is	normally	either	on	the exit	from	our	plants	(i.e.,	shipping	point)	or	on	arrival	at	customers'	plants	(i.e.,	destination	point).	We	do	not	recognize	revenue	from	transactions	where	we bill	customers,	but	retain	custody	and	title	to	these	products	until	the	date	custody	and	title	transfer.	We	do	not	have	any	significant	multiple	deliverable revenue	arrangements.

We	 net,	 against	 our	 gross	 sales,	 provisions	 for	 discounts,	 returns,	 allowances,	 customer	 rebates	 and	 other	 adjustments.	 We	 account	 for	 such provisions	during	the	same	period	in	which	we	record	the	related	revenues.	We	include	in	net	sales	any	amounts	related	to	shipping	and	handling	that	are billed	to	a	customer.	See	"Note	1.	Description	of	Business	and	Summary	of	Significant	Accounting	Policies	—	New	Accounting	Standards	— Recently	Adopted"	for	information	regarding	our	adoption	of	Accounting	Standards	Update	(" ASU")	2014-09,	which	is	codified	in	Financial	Accounting Standards	Board's	("FASB")	Accounting	Standard	Codification	("ASC")	606	"Revenue	from	Contracts	with	Customers"	effective	October	1,	2018.

# Shipping	and	Handling	Costs

We	classify	shipping	and	handling	costs,	such	as	freight	to	our	customers'	destinations,	as	a	component	of	cost	of	goods	sold.	When	shipping	and handling	costs	are	included	in	the	sales	price	charged	for	our	products,	they	are	recognized	in	net	sales.

# Cash	Equivalents

We	consider	all	highly	liquid	investments	that	mature	three	months	or	less	from	the	date	of	purchase	to	be	cash	equivalents.	The	carrying	amounts	we report	in	the	consolidated	balance	sheets	for	cash	and	cash	equivalents	approximate	fair	market	values.	We	place	our	cash	and	cash	equivalents	with	large credit	worthy	banks,	which	limits	the	amount	of	our	credit	exposure.

We	 derive	 our	 accounts	 receivable	 from	 revenue	 earned	 from	 customers	 located	 primarily	 in	 North	America,	 South	America,	 Europe,	Asia	 and Australia.	Given	our	diverse	customer	base,	we	have	limited	exposure	to	credit	loss	from	any	particular	customer	or	industry	segment,	and	hence	we generally	do	not	require	collateral.	We	perform	an	evaluation	of	probable	credit	losses	inherent	in	our	accounts	receivable	at	each	balance	sheet	date.	Such an	evaluation	includes	consideration	of	historical	loss	experience,	trends	in	customer	payment	frequency,	present	economic	conditions,	and	judgment	about the	future	financial	health	of	our	customers	and	industry	sector.	The	weighted	average	of	our	receivables	collection	is	within	30	to	60	days.	We	sell	certain receivables	under	our	New	A/R	Sales	Agreement.

We	state	accounts	receivable	at	the	amount	owed	by	the	customer,	net	of	an	allowance	for	estimated	uncollectible	accounts,	returns	and	allowances, cash	discounts	and	other	adjustments.	We	do	not	discount	accounts	receivable	because	we	generally	collect	accounts	receivable	over	a	relatively	short time.	We	account	for	sales	and	other	taxes	that	are	imposed	on	and	concurrent	with	individual	revenue-producing	transactions	between	a	customer	and	us on	a	net	basis	which	excludes	the	taxes	from	our	net	sales.	We	charge	off	receivables	when	they	are	determined	to	be	no	longer	collectible.	In	fiscal	2018, 2017	and	2016	our	bad	debt	expense	was	not	significant.

The	 following	 table	represents	a	summary	of the	changes in the	reserve for	allowance for	doubtful	accounts,	returns	and	allowances	and	cash discounts	for	fiscal	2018,	2017	and	2016	(in	millions):

# Inventories

We	value	substantially	all	U.S.	inventories	at	the	lower	of	cost	or	market,	with	cost	determined	on	the	LIFO	basis.	We	value	all	other	inventories	at	the lower	of	cost	and	net	realizable	value,	with	cost	determined	using	methods	that	approximate	cost	computed	on	a	first-in	first-out	inventory	valuation	method ("FIFO")	basis.	These	other	inventories	represent	primarily	foreign	inventories,	spare	parts	inventories	and	certain	inventoried	supplies	and	aggregate	to approximately	31%	and	32%	of	FIFO	cost	of	all	inventory	at	September	30,	2018	and	2017,	respectively.

Prior	to	the	application	of	the	LIFO	method,	our	U.S.	operating	divisions	use	a	variety	of	methods	to	estimate	the	FIFO	cost	of	their	finished	goods inventories.	Such	methods	include	standard	costs,	or	average	costs	computed	by	dividing	the	actual	cost	of	goods	manufactured	by	the	tons	produced	and multiplying	this	amount	by	the	tons	of	inventory	on	hand.	Lastly,	certain	operations	calculate	a	ratio,	on	a	plant	by	plant	basis,	the	numerator	of	which	is	the cost	of	goods	sold	and	the	denominator	is	net	sales.	This	ratio	is	applied	to	the	estimated	sales	value	of	the	finished	goods	inventory.	Variances	and	other unusual	items	are	analyzed	to	determine	whether	it	is	appropriate	to	include	those	items	in	the	value	of	inventory.	Examples	of	variances	and	unusual	items that	are	considered	to	be	current	period	charges	include,	but	are	not	limited	to,	abnormal	production	levels,	freight,	handling	costs,	and	wasted	materials (spoilage).	Cost	includes	raw	materials	and	supplies,	direct	labor,	indirect	labor	related	to	the	manufacturing	process	and	depreciation	and	other	factory overheads.	Our	inventoried	spare	parts	are	measured	at	average	cost.

# Property,	Plant	and	Equipment

We	state	property,	plant	and	equipment	at	cost	less	accumulated	depreciation.	Cost	includes	major	expenditures	for	improvements	and	replacements that	extend	useful	lives,	increase	capacity,	increase	revenues	or	reduce	costs,	while	normal	maintenance	and	repairs	are	expensed	as	incurred.	During fiscal	2018,	2017	and	2016,	we	capitalized	interest	of	approximately	$8.2	million,	$7.0	million	and	$7.6	million,	respectively.	For	financial	reporting	purposes, we	provide	depreciation	and	amortization	primarily	on	a	straight-line	method	generally	over	the	estimated	useful	lives	of	the	assets	as	follows:

Generally,	our	machinery	and	equipment	have	estimated	useful	lives	between	3	and	25	years;	however,	select	portions	of	machinery	and	equipment primarily	at	our	mills	have	estimated	useful	lives	up	to	44	years.	Greater	than	90%	of	the	cost	of	our	mill	assets	have	lives	of	25	years	or	less.	Leasehold improvements	are	depreciated	over	the	shorter	of	the	asset	life	or	the	lease	term,	generally	between	3	and	10	years.

# Goodwill	and	Long-Lived	Assets

We	review	the	carrying	value	of	our	goodwill	annually	at	the	beginning	of	the	fourth	quarter	of	each	fiscal	year,	or	more	often	if	events	or	changes	in circumstances	 indicate	 that	 the	 carrying	 amount	 may	 exceed	 fair	 value	 as	 set	 forth in	ASC	 350,	"Intangibles	—	Goodwill	and	Other."	 See "Note	 7. Discontinued	Operations"	for	information	on	the	first	quarter	of	fiscal	2016	goodwill	impairment	test	and	resulting	charge.	We	test	goodwill	for	impairment at	the	reporting	unit	level,	which	is	an	operating	segment	or	one	level	below	an	operating	segment,	referred	to	as	a	component.	A	component	of	an operating	segment	is	a	reporting	unit	if	the	component	constitutes	a	business	for	which	discrete	financial	information	is	available	and	segment	management regularly	reviews	the	operating	results	of	that	component.	However,	two	or	more	components	of	an	operating	segment	are	aggregated	and	deemed	a	single reporting	unit	if	the	components	have	similar	economic	characteristics.	The	amount	of	goodwill	acquired	in	a	business	combination	that	is	assigned	to	one or	more	reporting	units	as	of	the	acquisition	date	is	the	excess	of	the	purchase	price	of	the	acquired	businesses	(or	portion	thereof)	included	in	the	reporting unit,	over	the	fair	value	assigned	to	the	individual	assets	acquired	or	liabilities	assumed.	Goodwill	is	assigned	to	the	reporting	unit(s)	expected	to	benefit from	the	synergies	of	the	combination	even	though	other	assets	or	liabilities	of	the	acquired	entity	may	not	be	assigned	to	that	reporting	unit.	We	determine recoverability	by	comparing	the	estimated	fair	value	of	the	reporting	unit	to	which	the	goodwill	applies	to	the	carrying	value,	including	goodwill,	of	that reporting	unit.	We	determine	the	fair	value	of	each	reporting	unit	using	the	discounted	cash	flow	method	or,	as	appropriate,	a	combination	of	the	discounted cash	flow	method	and	the	guideline	public	company	method.

The	 goodwill	 impairment	 model	 is	 a	 two-step	 process.	An	 amendment	 to	ASC	 350	 became	 effective	 December	 2011	 that	 allows	 a	 qualitative assessment,	prior	to	step	one,	to	determine	whether	it	is	more	likely	than	not	that	the	fair	value	of	a	reporting	unit	exceeds	its	carrying	amount.	We	did	not attempt	a	qualitative	assessment	and	moved	directly	to	step	one.	In	step	one,	we	utilize	the	present	value	of	expected	net	cash	flows	or,	as	appropriate,	a combination	of	the	present	value	of	expected	net	cash	flows	and	the	guideline	public	company	method	to	determine	the	estimated	fair	value	of	our	reporting units.	This	present	value	model	requires	management	to	estimate	future	net	cash	flows,	the	timing	of	these	cash	flows,	and	a	discount	rate	(based	on	a weighted	average	cost	of	capital),	which	represents	the	time	value	of	money	and	the	inherent	risk	and	uncertainty	of	the	future	cash	flows.	Factors	that management	must	estimate	when	performing	this	step	in	the	process	include,	among	other	items,	sales	volume,	prices,	inflation,	discount	rates,	exchange rates,	tax	rates,	anticipated	synergies	and	productivity	improvements	resulting	from	acquisitions,	capital	expenditures	and	continuous	improvement	projects. The	assumptions	we	use	to	estimate	future	cash	flows	are	consistent	with	the	assumptions	that	the	reporting	units	use	for	internal	planning	purposes, updated	to	reflect	current	expectations.	The	guideline	public	company	method	involves	comparing	the	reporting	unit	to	similar	companies	whose	stock	is freely	traded	on	an	organized	exchange.	The	fair	values	determined	by	the	discounted	cash	flow	and	guideline	public	company	methods	were	weighted	to arrive	at	the	concluded	fair	value	of	the	reporting	unit.	However,	in	instances	where	comparisons	to	our	peers	is	less	meaningful,	no	weight	was	placed	on the	guideline	public	company	method	to	arrive	at	the	concluded	fair	value	of	the	reporting	unit.	If	we	determine	that	the	estimated	fair	value	of	the	reporting unit	exceeds	its	carrying	amount,	goodwill	of	the	reporting	unit	is	not	impaired.	If	we	determine	that	the	carrying	amount	of	the	reporting	unit	exceeds	its estimated

fair	value,	we	would	complete	step	two	of	the	impairment	analysis.	Step	two	involves	determining	the	implied	fair	value	of	the	reporting	unit's	goodwill	and comparing	it	to	the	carrying	amount	of	that	goodwill.	If	the	carrying	amount	of	the	reporting	unit's	goodwill	exceeds	the	implied	fair	value	of	that	goodwill,	we recognize	an	impairment	loss	in	an	amount	equal	to	that	excess.	While	ASU	2017-04,	"Simplifying	the	Test	for	Goodwill	Impairment ",	amends	the	guidance in	ASC	350,	we	have	not	yet	adopted	the	ASU.

During	the	fourth	quarter	of	fiscal	2018,	of	those	reporting	units	that	have	goodwill,	our	Consumer	Packaging	reporting	unit	had	a	fair	value	which exceeded	its	carrying	value	by	less	than	10%,	primarily	due	to	the	fair	value	accounting	related	to	the	Combination	and	the	MPS	Acquisition.	If	we	had concluded	that	it	was	appropriate	to	increase	the	discount	rate	we	used	by	100	basis	points	to	estimate	the	fair	value	of	each	reporting	unit	that	has goodwill,	the	fair	value	of	each	of	our	reporting	units	would	have	continued	to	exceed	its	carrying	value,	except	for	the	Consumer	Packaging	reporting	unit. No	events	have	occurred	since	the	latest	annual	goodwill	impairment	assessment	that	would	necessitate	an	interim	goodwill	impairment	assessment.

We	follow	the	provisions	included	in	ASC	360,	"Property,	Plant	and	Equipment"	in	determining	whether	the	carrying	value	of	any	of	our	long-lived assets,	including	amortizing	intangibles	other	than	goodwill,	is	impaired.	The	ASC	360	test	is	a	three-step	test	for	assets	that	are	"held	and	used"	as	that term	is	defined	by	ASC	360.	We	determine	whether	indicators	of	impairment	are	present.	We	review	long-lived	assets	for	impairment	when	events	or changes	in	circumstances	indicate	that	the	carrying	amount	of	the	long-lived	asset	might	not	be	recoverable.	If	we	determine	that	indicators	of	impairment are	present,	we	determine	whether	the	estimated	undiscounted	cash	flows	for	the	potentially	impaired	assets	are	less	than	the	carrying	value.	This	requires management	to	estimate	future	net	cash	flows	through	operations	over	the	remaining	useful	life	of	the	asset	and	its	ultimate	disposition.	The	assumptions we	use	to	estimate	future	cash	flows	are	consistent	with	the	assumptions	we	use	for	internal	planning	purposes,	updated	to	reflect	current	expectations.	If our	estimated	undiscounted	cash	flows	do	not	exceed	the	carrying	value,	we	estimate	the	fair	value	of	the	asset	and	record	an	impairment	charge	if	the carrying	value	is	greater	than	the	fair	value	of	the	asset.	We	estimate	fair	value	using	discounted	cash	flows,	observable	prices	for	similar	assets,	or	other valuation	techniques.	We	record	assets	classified	as	"held	for	sale"	at	the	lower	of	their	carrying	value	or	estimated	fair	value	less	anticipated	costs	to	sell.

Included	in	our	long-lived	assets	are	certain	identifiable	intangible	assets.	These	intangible	assets	are	amortized	based	on	the	approximate	pattern	in which	the	economic	benefits	are	consumed	or	straight-line	if	the	pattern	was	not	reliably	determinable.	Estimated	useful	lives	range	from	1	to	40	years	and have	a	weighted	average	life	of	approximately	16.6	years.

Our	judgments	regarding	the	existence	of	impairment	indicators	are	based	on	legal	factors,	market	conditions	and	operational	performance.	Future events	 could	 cause	 us	 to	 conclude	 that	 impairment	 indicators	 exist	 and	 that	 assets	 associated	 with	 a	 particular	 operation	 are	 impaired.	 Evaluating impairment	also	requires	us	to	estimate	future	operating	results	and	cash	flows,	which	also	require	judgment	by	management.	Any	resulting	impairment	loss could	have	a	material	adverse	impact	on	our	financial	condition	and	results	of	operations.

Our	restructuring	and	other	costs	include	primarily	items	such	as	restructuring	portions	of	our	operations,	acquisition	costs,	integration	costs	and divestiture	costs.	We	have	restructured	portions	of	our	operations	from	time	to	time,	have	current	restructuring	initiatives	taking	place,	and	it	is	possible	that we	may	engage	in	future	restructuring	activities.	Identifying	and	calculating	the	cost	to	exit	these	operations	requires	certain	assumptions	to	be	made,	the most	 significant	 of	 which	 are	 anticipated	 future	 liabilities,	 including	 severance	 costs,	 leases	 and	 other	 contractual	 obligations,	 and	 the	 adjustment	 of property,	plant	and	equipment	to	net	realizable	value.	We	believe	our	estimates	are	reasonable,	considering	our	knowledge	of	the	industries	we	operate	in, previous	experience	 in	exiting	activities	and	valuations	we	may	obtain	 from	 independent	 third	parties.	Although	our	estimates	have	been	reasonably accurate	in	the	past,	significant	judgment	is	required,	and	these	estimates	and	assumptions	may	change	as	additional	information	becomes	available	and facts	 or	 circumstances	 change.	 See "Note	 3.	 Restructuring	 and	 Other	 Costs"	 of the	 Notes	 to	 Consolidated	 Financial	 Statements	 for	 additional information,	including	a	description	of	the	type	of	costs	incurred.

# Business	Combinations

From	time	to	time,	we	may	enter	into	business	combinations.	In	accordance	with	ASC	805,	" Business	Combinations",	we	generally	recognize	the identifiable	assets	acquired,	the	liabilities	assumed,	and	any	noncontrolling	interests	in	an	acquiree	at	their	fair	values	as	of	the	date	of	acquisition.	We measure	goodwill	as	the	excess	of	consideration	transferred,	which	we	also	measure	at	fair	value,	over	the	net	of	the	acquisition	date	fair	values	of	the identifiable	assets	acquired	and	 liabilities	assumed.	The	acquisition	method	of	accounting	requires	us	 to	make	significant	estimates	and	assumptions regarding	the	fair	values	of	the	elements	of	a	business	combination	as	of	the	date	of	acquisition,	including	the	fair	values	of	identifiable	intangible	assets, deferred	 tax	 asset	 valuation	 allowances,	 liabilities	 including	 those	 related	 to	 debt,	 pensions	 and	 other	 postretirement	 plans,	 uncertain	 tax	 positions, contingent	consideration	and	contingencies.	This	method	also	requires	us	to	refine	these	estimates	over	a	measurement	period	not	to	exceed	one	year	to reflect	new	information	obtained	about	facts	and	circumstances	that	existed	as	of	the	acquisition	date	that,	if	known,	would	have	affected	the	measurement of	the	amounts	recognized	as	of	that	date.	If	we	are	required	to	adjust	provisional	amounts	that	we	have	recorded	for	the	fair	values	of	assets	and	liabilities in	connection	with	acquisitions,	these	adjustments	could	have	a	material	impact	on	our	financial	condition	and	results	of	operations.

Significant	estimates	and	assumptions	in	estimating	the	fair	value	of	acquired	technology,	customer	relationships,	and	other	identifiable	intangible assets	include	future	cash	flows	that	we	expect	to	generate	from	the	acquired	assets.	If	the	subsequent	actual	results	and	updated	projections	of	the underlying	business	activity	change	compared	with	the	assumptions	and	projections	used	to	develop	these	values,	we	could	record	impairment	charges.	In addition,	we	have	estimated	the	economic	lives	of	certain	acquired	assets	and	these	lives	are	used	to	calculate	depreciation	and	amortization	expense.	If our	estimates	of	the	economic	lives	change,	depreciation	or	amortization	expenses	could	be	increased	or	decreased,	or	the	acquired	asset	could	be impaired.

# Fair	Value	of	Financial	Instruments	and	Nonfinancial	Assets	and	Liabilities

We	estimate	fair	values	in	accordance	with	ASC	820,	 "Fair	Value	Measurement."	We	define	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.

Financial	instruments	not	recognized	at	fair	value	on	a	recurring	or	nonrecurring	basis	include	cash	and	cash	equivalents,	accounts	receivables, 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.	The	fair	values	of	our	long-term	debt	are	estimated using	quoted	market	prices	or	are	based	on	the	discounted	value	of	future	cash	flows.	We	disclose	the	fair	value	of	long-term	debt	in	"Note	13.	Debt"	and our	 pension	 and	 postretirement	 assets	 and	 liabilities in	"Note	4.	Retirement	Plans".	We	have,	or from	 time	 to	 time	may	have,	 financial	 instruments recognized	 at	 fair	 value	 including	 supplemental	 retirement	 savings	 plans	 ("Supplemental	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	class	of	assets	or	liabilities, the	fair	value	of	which	are	not	significant.	We	measure	the	fair	value	of	our	mutual	fund	investments	based	on	quoted	prices	in	active	markets,	and	our derivative	contracts,	if	any,	based	on	discounted	cash	flows.

We	measure	certain	nonfinancial	assets	and	nonfinancial	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	 a	 merger	 or	 an acquisition	or	in	a	nonmonetary	exchange,	and	property,	plant	and	equipment	and	goodwill	and	other	intangible	assets	that	are	written	down	to	fair	value when	 they	are	held	 for	sale	or	determined	 to	be	 impaired.	Given	 the	nature	of	nonfinancial	assets	and	 liabilities,	evaluating	 their	 fair	value	 from	 the perspective	of	a	market	participant	is	inherently	complex.	Assumptions	and	estimates	about	future	values	can	be	affected	by	a	variety	of	internal	and external	factors.	Changes	in	these	factors	may	require	us	to	revise	our	estimates	and	could	result	in	future	impairment	charges	for	goodwill	and	acquired intangible	assets,	or	retroactively	adjust	provisional	amounts	that	we	have	recorded	for	the	fair	values	of	assets	and	liabilities	in	connection	with	business combinations.	These	adjustments	could	have	a	material	impact	on	our	financial	condition	and	results	of	operations.	We	discuss	fair	values	in	more	detail	in "Note	12.	Fair	Value".

# Derivatives

We	are	exposed	to	interest	rate	risk,	commodity	price	risk	and	foreign	currency	exchange	risk.	To	manage	these	risks,	from	time	to	time	and	to	varying degrees,	we	may	enter	into	a	variety	of	financial	derivative	transactions	and	certain	physical	commodity	transactions	that	are	determined	to	be	derivatives. Interest	rate	swaps	may	be	entered	into	to	manage	the	interest	rate	risk	associated	with	a	portion	of	our	outstanding	debt.	Interest	rate	swaps	are	either designated	for	accounting	purposes	as	cash	flow	hedges	of	forecasted	floating	interest	payments	on	variable	rate	debt	or	fair	value	hedges	of	fixed	rate debt,	or	we	may	elect	not	to	treat	them	as	accounting	hedges.	Swaps	or	forward	contracts	on	certain	commodities	may	be	entered	into	to	manage	the	price risk	 associated	 with	 forecasted	 purchases	 or	 sales	 of	 those	 commodities.	 In	 addition,	 certain	 commodity	 financial	 derivative	 contracts	 and	 physical commodity	contracts	that	are	determined	to	be	derivatives	may	not	be	designated	as	accounting	hedges	because	either	they	do	not	meet	the	criteria	for treatment	as	accounting	hedges	under	ASC	815,	"Derivatives	and	Hedging",	or	we	elect	not	to	treat	them	as	accounting	hedges	under	ASC	815.	We	may also	enter	into	forward	contracts	to	manage	our	exposure	to	fluctuations	in	foreign	currency	rates	with	respect	to	transactions	denominated	in	currencies such	as	Canadian	dollars,	 the	Euro	or	Brazilian	Real.	These	also	can	either	be	designated	 for	accounting	purposes	as	cash	 flow	hedges	or	not	so designated.

Outstanding	 financial	 derivative	 instruments	 expose	 us	 to	 credit	 loss	 in	 the	 event	 of	 nonperformance	 by	 the	 counterparties	 to	 the	 derivative agreements.	Our	credit	exposure	related	to	these	financial	instruments	is	represented	by	the	fair	value	of	contracts	reported	as	assets.	We	manage	our exposure	to	counterparty	credit	risk	through	minimum	credit	standards,	diversification	of	counterparties	and	procedures	to	monitor	concentrations	of	credit risk.	We	may	enter	into	financial	derivative	contracts	that	may	contain	credit-risk-related	contingent	features	which	could	result	in	a	counterparty	requesting immediate	payment	or	demanding	immediate	and	ongoing	full	overnight	collateralization	on	derivative	instruments	in	net	liability	positions.

For	financial	derivative	instruments	that	are	designated	as	a	cash	flow	hedge	for	accounting	purposes,	the	effective	portion	of	the	gain	or	loss	on	the financial	derivative	instrument	is	reported	as	a	component	of	other	comprehensive	income	and	reclassified	into	earnings	in	the	same	line	item	associated with	the	forecasted	transaction,	and	in	the	same	period	or	periods	during	which	the	forecasted	transaction	affects	earnings.	Gains	and	losses	on	the financial	 derivative	 instrument	 representing	 either	 hedge	 ineffectiveness	 or	 hedge	 components	 excluded	 from	 the	 assessment	 of	 effectiveness	 are recognized	in	current	earnings.

We	have	at	times	entered	into	interest	rate	swap	agreements	that	effectively	modified	our	exposure	to	interest	rate	risk	by	converting	a	portion	of	our interest	payments	on	floating	rate	debt	to	a	fixed	rate	basis,	thus	reducing	the	impact	of	interest	rate	changes	on	future	interest	expense.	These	agreements typically	involved	the	receipt	of	floating	rate	amounts	in	exchange	for	fixed	interest	rate	payments	over	the	life	of	the	agreements	without	an	exchange	of	the underlying	principal	amount.

At	September	30,	2018,	there	were	no	interest	rate	or	commodity	derivatives	outstanding,	and	the	notional	amount	of	foreign	currency	derivatives	were $356.0	million.	At	September	30,	2017,	there	were	no	interest	rate	or	commodity	derivatives	outstanding,	and	the	notional	amount	of	foreign	currency derivatives	were	$47.8	million.	For	additional	information	see	"Note	13.	Debt".

# Health	Insurance

We	are	self-insured	for	the	majority	of	our	group	health	insurance	costs.	However,	we	seek	to	limit	our	health	insurance	costs	by	entering	into	certain stop	loss	insurance	coverage.	Due	to	mergers,	acquisitions	and	other	factors,	we	may	have	plans	that	do	not	include	stop	loss	insurance.	We	calculate	our group	 health	 insurance	 reserve	 on	 an	 undiscounted	 basis	 based	 on	 estimated	 reserve	 rates.	 We	 utilize	 claims	 lag	 data	 provided	 by	 our	 claims administrators	to	compute	the	required	estimated	reserve	rate.	We	calculate	our	average	monthly	claims	paid	using	the	actual	monthly	payments	during	the trailing	 12-month	 period.	At	 that	 time,	 we	 also	 calculate	 our	 required	 reserve	 using	 the	 reserve	 rates	 discussed	 above.	 While	 we	 believe	 that	 our assumptions	are	appropriate,	significant	differences	in	our	actual	experience	or	significant	changes	in	our	assumptions	may	materially	affect	our	group health	insurance	costs.

# Workers'	Compensation

We	purchase	large	risk	deductible	workers'	compensation	policies	for	the	majority	of	our	workers'	compensation	liabilities	that	are	subject	to	various deductibles	to	limit	our	exposure.	We	calculate	our	workers'	compensation	reserves	on	an	undiscounted	basis	based	on	estimated	actuarially	calculated development	factors.	While	we	believe	that	our	assumptions	are	appropriate,	significant	differences	in	our	actual	experience	or	significant	changes	in	our assumptions	may	materially	affect	our	workers'	compensation	costs.

# Income	Taxes

We	account	for	income	taxes	under	the	asset	and	liability	method,	which	requires	the	recognition	of	deferred	tax	assets	and	liabilities	for	the	expected future	tax	consequences	of	events	that	have	been	included	in	the	financial	statements.	Under	this	method,	deferred	tax	assets	and	liabilities	are	determined based	on	the	differences	between	the	financial	statement	carrying	amount	and	the	tax	basis	of	assets	and	liabilities	using	enacted	tax	rates	in	effect	for	the year	in	which	the	differences	are	expected	to	reverse.	The	effect	of	a	change	in	tax	rates	on	deferred	tax	assets	and	liabilities	is	recognized	in	income	in	the period	that	includes	the	enactment	date.	All	deferred	tax	assets	and	liabilities	are	classified	as	noncurrent	in	our	consolidated	balance	sheet	in	accordance with	ASU	2015-17,	"Income	Taxes:	Balance	Sheet	Classification	of	Deferred	Taxes."

We	record	net	deferred	tax	assets	to	the	extent	we	believe	these	assets	will	more	likely	than	not	be	realized.	In	making	such	determination,	we consider	all	available	positive	and	negative	evidence,	including	future	reversals	of	existing	taxable	temporary	differences,	projected	future	taxable	income, tax	planning	strategies,	recent	financial	operations	and	their	associated	valuation	allowances,	if	any.	In	the	event	we	were	to	determine	that	we	would	be able	to	realize	or	not	realize	our	deferred	income	tax	assets	in	the	future	in	their	net	recorded	amount,	we	would	make	an	adjustment	to	the	valuation allowance,	which	would	reduce	or	increase	the	provision	for	income	taxes,	respectively.

Certain	provisions	of	ASC	740,	 "Income	Taxes"	provide	that	a	tax	benefit	from	an	uncertain	tax	position	may	be	recognized	when	it	is	more	likely	than not	that	the	position	will	be	sustained	upon	examination,	including	resolutions	of	any	related	appeals	or	litigation	processes,	based	on	the	technical	merits. Income	tax	positions	must	meet	a	more	likely	than	not	recognition	threshold	at	the	effective	date	to	be	recognized.

On	December	22,	2017,	the	Tax	Act	was	signed	into	law.	The	Tax	Act	contains	significant	changes	to	corporate	taxation,	including	(i)	the	reduction	of the	corporate	income	tax	rate	to	21%,	(ii)	the	acceleration	of	expensing	for	certain	business	assets,	(iii)	the	one-time	transition	tax	related	to	the	transition	of U.S.	international	tax	from	a	worldwide	tax	system	to	a	territorial	tax	system,	(iv)	the	repeal	of	the	domestic	production	deduction,	(v)	additional	limitations on	the	deductibility	of	interest	expense	and	(vi)	expanded	limitations	on	executive	compensation.	See	"Note	5.	Income	Taxes."

We	account	for	pension	and	other	postretirement	benefits	in	accordance	with	ASC	715,	" Compensation	–	Retirement	Benefits".	Accordingly,	we recognize	the	funded	status	of	our	pension	plans	as	assets	or	liabilities	in	our	consolidated	balance	sheets.	The	funded	status	is	the	difference	between	our projected	benefit	obligations	and	fair	value	of	plan	assets.	The	determination	of	our	obligation	and	expense	for	pension	and	other	postretirement	benefits	is dependent	on	our	selection	of	certain	assumptions	used	by	actuaries	in	calculating	such	amounts.	We	describe	these	assumptions	in	"Note	4.	Retirement Plans",	which	include,	among	others,	the	discount	rate,	expected	long-term	rates	of	return	on	plan	assets	and	rates	of	increase	in	compensation	levels.	As provided	under	ASC	715,	we	defer	actual	results	that	differ	from	our	assumptions,	i.e.	actuarial	gains	and	losses,	and	amortize	the	difference	over	future periods.	Therefore,	these	differences	generally	affect	our	recognized	expense	and	funding	requirements	in	future	periods.	Actuarial	gains	and	losses	occur when	actual	experience	differs	from	the	estimates	used	to	determine	the	components	of	net	periodic	pension	cost	and	when	certain	assumptions	used	to determine	the	fair	value	of	the	plan	assets	or	projected	benefit	obligation	are	updated,	such	as	but	not	limited	to,	changes	in	the	discount	rate,	plan amendments,	differences	between	actual	and	expected	returns	on	plan	assets,	mortality	assumptions	and	plan	remeasurement.

The	amount	of	unrecognized	actuarial	gains	and	losses	recognized	in	the	current	year's	operations	is	based	on	amortizing	the	unrecognized	gains	or losses	for	each	plan	that	exceed	the	larger	of	10%	of	the	projected	benefit	obligation	or	the	fair	value	of	plan	assets,	also	known	as	"the	corridor".	The amount	of	unrecognized	gain	or	loss	that	exceeds	the	corridor	is	amortized	over	the	average	future	service	of	the	plan	participants	or	the	average	life

expectancy	of	inactive	plan	participants	for	plans	where	all	or	almost	all	of	the	plan	participants	are	inactive.	While	we	believe	that	our	assumptions	are appropriate,	 significant	 differences	 in	 our	 actual	 experience	 or	 significant	 changes	 in	 our	 assumptions	 may	 materially	 affect	 our	 pension	 and	 other postretirement	benefit	obligations	and	our	future	expense.

# Share-Based	Compensation

We	recognize	expense	for	share-based	compensation	plans	based	on	the	estimated	fair	value	of	the	related	awards	in	accordance	with	ASC	718, "Compensation	–	Stock	Compensation".	Pursuant	to	our	incentive	stock	plans,	we	can	grant	options	and	restricted	stock,	stock	appreciation	rights	(" SAR"	or "SARs")	and	restricted	stock	units	to	employees	and	our	non-employee	directors.	The	grants	generally	vest	over	a	period	of	up	to	three	years	depending	on the	nature	of	the	award,	except	for	non-employee	director	grants,	which	typically	vest	over	a	period	of	up	to	one	year.	The	majority	of	our	restricted	stock grants	to	employees	generally	contain	performance	or	market	conditions	that	must	be	met	in	conjunction	with	a	service	requirement	for	the	shares	to	vest, others	contain	only	a	service	requirement.	We	charge	compensation	under	the	plan	to	earnings	over	each	increment's	individual	vesting	period.	See	"Note 20.	Share-Based	Compensation"	for	additional	information.

# Asset	Retirement	Obligations

The	Company	accounts	for	asset	retirement	obligations	in	accordance	with	ASC	410,	" Asset	Retirement	and	Environmental	Obligations".	A	liability and	an	asset	are	recorded	equal	to	the	present	value	of	the	estimated	costs	associated	with	the	retirement	of	long-lived	assets	where	a	legal	or	contractual obligation	exists	and	the	liability	can	be	reasonably	estimated.	The	liability	is	accreted	over	time	and	the	asset	is	depreciated	over	the	remaining	life	of	the related	asset.	Upon	settlement	of	the	liability,	we	will	recognize	a	gain	or	loss	for	any	difference	between	the	settlement	amount	and	the	liability	recorded. Asset	retirement	obligations	with	indeterminate	settlement	dates	are	not	recorded	until	such	time	that	a	reasonable	estimate	may	be	made.	Our	asset retirement	obligations	consist	primarily	of	landfill	closure	and	post-closure	costs	at	certain	of	our	mills.	At	September	30,	2018	and	September	30,	2017,	we had	recorded	liabilities	of	$72.9	million	and	$70.5	million,	respectively.	The	liabilities	are	primarily	reflected	as	other	long-term	liabilities	on	the	consolidated balance	sheets.

# Repair	and	Maintenance	Costs

We	expense	routine	repair	and	maintenance	costs	as	we	incur	them.	We	defer	certain	expenses	we	incur	during	planned	major	maintenance	activities and	recognize	the	expenses	ratably	over	the	shorter	of	the	estimated	interval	until	the	next	major	maintenance	activity	or	the	life	of	the	deferred	item.	This maintenance	is	generally	performed	every	twelve	to	twenty-four	months	and	has	a	significant	impact	on	our	results	of	operations	in	the	period	performed primarily	due	to	lost	production	during	the	maintenance	period.	Planned	major	maintenance	costs	deferred	at	September	30,	2018	and	2017	were	$83.4 million	and	80.8	million,	respectively.	The	assets	are	recorded	as	other	assets	on	the	consolidated	balance	sheets.

We	translate	the	assets	and	liabilities	of	our	foreign	operations	from	their	functional	currency	into	U.S.	dollars	at	the	rate	of	exchange	in	effect	as	of	the balance	sheet	date.	We	reflect	the	resulting	translation	adjustments	in	equity.	We	translate	the	revenues	and	expenses	of	our	foreign	operations	at	a	daily average	rate	prevailing	for	each	month	during	the	fiscal	year.	We	include	gains	or	losses	from	foreign	currency	transactions,	such	as	those	resulting	from the	settlement	of	foreign	receivables	or	payables,	in	the	consolidated	statements	of	operations.	We	recorded	a	gain	on	foreign	currency	transactions	of $12.2	million	and	$4.3	million	in	fiscal	2018	and	2017,	respectively.	We	recorded	a	loss	on	foreign	currency	transactions	of	$6.5	million	in	fiscal	2016.

# Environmental	Remediation	Costs

We	accrue	for	losses	associated	with	our	environmental	remediation	obligations	when	it	is	probable	that	we	have	incurred	a	liability	and	the	amount	of the	loss	can	be	reasonably	estimated.	We	generally	recognize	accruals	for	estimated	losses	from	our	environmental	remediation	obligations	no	later	than completion	of	the	remedial	feasibility	study	and	adjust	such	accruals	as	further	information	develops	or	circumstances	change.	We	recognize	recoveries	of our	 environmental	 remediation	 costs	 from	 other	 parties	 as	 assets	 when	 we	 deem	 their	 receipt	 probable.	 See "Note 17.	 Commitments and Contingencies."

# New	Accounting	Standards	-	Recently	Adopted

In	May	2017,	the	FASB	issued	ASU	2017-09,	"Compensation	–	Stock	Compensation:	Scope	of	Modification	Accounting".	The	amendments	in	the ASU	include	guidance	on	determining	which	changes	to	the	terms	and	conditions	of	share-based	payment	awards	require	an	entity	to	apply	modification accounting	under	ASC	718,	"Compensation	–	Stock	Compensation"	and	require	entities	to	account	for	the	effects	of	a	modification	unless	all	of	the	following conditions	are	met:	(a)	the	fair	value	(or	calculated	value	or	intrinsic	value,	if	such	an	alternative	measurement	method	is	used)	of	the	modified	award	is	the same	as	the	fair	value	(or	value	using	an	alternative	measurement	method)	of	the	original	award	immediately	before	the	original	award	is	modified;	(b)	the vesting	conditions	of	the	modified	award	are	the	same	as	the	vesting	conditions	of	the	original	award	immediately	before	the	original	award	is	modified;	and (c)	the	classification	of	the	modified	award	as	an	equity	instrument	or	a	liability	instrument	is	the	same	as	the	classification	of	the	original	award	immediately before	the	original	award	is	modified.	We	adopted	the	provisions	of	this	ASU	on	October	1,	2018	on	a	prospective	basis.	These	provisions	did	not	have	a material	effect	on	our	consolidated	financial	position,	results	of	operations	or	cash	flows.

In	 March	 2017,	 the	 FASB	 issued	 ASU	 2017-07, " Compensation: Improving the	 Presentation	 of	 Net	 Periodic	 Pension	 Cost	 and	 Net	 Periodic Postretirement	Benefit	Cost".	The	guidance	in	this	update	requires	that	an	employer	disaggregate	the	service	cost	component	from	the	other	components	of net	benefit	cost.	Non-service	cost	components	of	net	periodic	pension	cost	are	required	to	be	presented	in	the	income	statement	separately	from	the service	cost	component	and	outside	the	subtotal	of	operating	income.	The	amendments	in	the	update	also	allow	only	the	service	cost	component	to	be eligible	for	capitalization	for	internally	developed	capital	projects.	We	adopted	the	provisions	of	this	ASU	on	October	1,	2018	on	a	retrospective	basis.	The adoption	resulted	in	a	change	in	our	operating	profit,	which	was	offset	by	a	corresponding	change	in	non-operating	pension	income	(expense)	to	reflect	the impact	of	presenting	the	non-service	income	(cost)	component	of	net	periodic	pension	income	(expense)	outside	of	operating	income.	Further,	limiting	the capitalization	 of	 net	 periodic	 cost	 in	 assets	 to	 the	 service	 cost	 component	 will	 not	 have	 a	 material	 impact	 on	 our	 consolidated	 financial	 statements prospectively.	There	was	no	associated	impact	to	our	consolidated	statements	of	cash	flows.

In	February	2017,	the	FASB	issued	ASU	2017-05,	" Other	Income:	Clarifying	the	Scope	of	Asset	Derecognition	Guidance	and	Accounting	for	Partial Sales	of	Nonfinancial	Assets".	The	ASU	provides	guidance	for	recognizing	gains	and	losses	from	the	transfer	of	nonfinancial	assets	in	contracts	with noncustomers.	Specifically,	the	ASU	clarifies	the	scope	of	an	"in	substance	nonfinancial	asset",	the	treatment	of	partial	sales	of	nonfinancial	assets	and guidance	on	accounting	for	contributions	of	nonfinancial	assets	to	joint	ventures	and	equity	method	investees.	We	adopted	the	provisions	of	this	ASU	on October	1,	2018	on	a	retrospective	basis.	These	provisions	did	not	have	a	material	impact	on	our	consolidated	financial	position,	results	of	operations	or cash	flows.

In	January	2017,	the	FASB	issued	ASU	2017-01,	" Clarifying	the	Definition	of	a	Business",	which	amends	the	guidance	in	ASC	805,	" Business Combinations".	The	ASU	 clarifies	 the	 definition	 of	 a	 business.	The	 definition	 of	 a	 business	 affects	 many	 areas	 of	 accounting,	 including	 acquisitions, disposals,	goodwill,	and	consolidation.	The	amendments	are	intended	to	help	companies	and	other	organizations	evaluate	whether	transactions	should	be accounted	for	as	acquisitions	(or	disposals)	of	assets	or	businesses.	We	adopted	the	provisions	of	this	ASU	on	October	1,	2018	prospectively.	These provisions	did	not	have	a	material	impact	on	our	consolidated	financial	position,	results	of	operations	or	cash	flows.

In	November	2016,	the	FASB	issued	ASU	2016-18,	" Restricted	Cash",	which	amends	the	guidance	in	the	FASB's	ASC	230,	" Statement	of	Cash Flows".	The	new	ASU	clarifies	how	entities	should	present	restricted	cash	and	restricted	cash	equivalents	in	the	statement	of	cash	flows.	The	amendments in	this	ASU	require	that	a	statement	of	cash	flows	explain	the	change	during	the	period	in	the	total	of	cash,	cash	equivalents,	and	amounts	generally described	as	restricted	cash	or	restricted	cash	equivalents.	Therefore,	amounts	generally	described	as	restricted	cash	and	restricted	cash	equivalents should	be	included	with	cash	and	cash	equivalents	when	reconciling	the	beginning-of-period	and	end-of-period	total	amounts	shown	on	the	statement	of cash	flows.	We	adopted	the	provisions	of	this	ASU	on	October	1,	2018	on	a	retrospective	basis.	As	a	result	of	the	provisions	of	this	ASU,	restricted	cash	will be	included	within	cash	and	cash	equivalents	on	our	consolidated	statements	of	cash	flows.

In	October	2016,	the	FASB	issued	ASU	2016-16,	" Income	Taxes:	Intra-Entity	Transfers	of	Assets	Other	Than	Inventory ",	which	requires	companies	to recognize	the	income	tax	effects	of	intercompany	sales	and	transfers	of	assets	other	than	inventory	(e.g.,	intangible	assets)	in	the	period	in	which	the transfer	occurs.	Current	guidance	requires	companies	to	defer	the	income	tax	effects	of	intercompany	transfers	of	assets	until	the	asset	has	been	sold

to	an	outside	party	or	otherwise	recognized	through	use.	The	new	guidance	will	require	companies	to	defer	the	income	tax	effects	only	of	intercompany transfers	of	inventory.	The	guidance	requires	companies	to	apply	a	modified	retrospective	approach	with	a	cumulative	catch-up	adjustment	to	opening retained	earnings	in	the	period	of	adoption.	We	adopted	these	provisions	on	October	1,	2018	and	the	adoption	of	these	provisions	did	not	have	a	material effect	on	our	consolidated	financial	position,	results	of	operations	or	cash	flows.

In	August	2016,	the	FASB	issued	ASU	2016-15	" Classification	of	Certain	Cash	Receipts	and	Cash	Payments ",	which	amends	the	guidance	in	ASC 230,	"Statement	of	Cash	Flows".	The	ASU	clarifies	how	entities	should	classify	certain	cash	receipts	and	cash	payments	on	the	statement	of	cash	flows	for the	following	transactions:	debt	prepayment	or	extinguishment	costs,	settlement	of	zero-coupon	debt	instruments	or	other	debt	instruments	with	coupon rates	that	are	insignificant	in	relation	to	the	effective	interest	rate	of	the	borrowing,	contingent	consideration	payments	made	after	a	business	combination, proceeds	 from	 the	settlement	of	 insurance	claims,	proceeds	 from	 the	settlement	of	corporate-owned	 life	 insurance,	distributions	received	 from	equity method	investees	and	beneficial	interests	in	securitization	transactions.	The	ASU	also	clarifies	how	the	predominance	principle	should	be	applied	when cash	receipts	and	cash	payments	have	aspects	of	more	than	one	class	of	cash	flows.	We	adopted	the	provisions	of	this	ASU	on	October	1,	2018	on	a retrospective	basis.	The	adoption	resulted	in	change	in	classification	of	proceeds	received	for	beneficial	interests	obtained	for	transferring	trade	receivables in	securitization	transactions	as	investing	activities	instead	of	operating	activities.	This	ASU	will	not	have	a	material	effect	on	our	consolidated	financial statements	on	a	prospective	basis	because	the	creation	of	beneficial	interest	was	eliminated	under	the	terms	of	our	New	A/R	Sales	Agreement	effective September	25,	2018.

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	in	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.	These	provisions	can	be	implemented	using	a	full retrospective	or	modified	retrospective	approach	and	the	FASB	has	clarified	this	guidance	in	various	updates	(e.g.,	ASU	2015-14,	ASU	2016-08,	ASU	2016- 10,	ASU	2016-12,	ASU	2016-20	and	ASU	2017-05).

We	adopted	the	provisions	of	ASU	2014-09	on	October	1,	2018.		We	manufacture	certain	products	that	have	no	alternative	use	to	us	(since	such products	are	made	to	specific	customer	orders),	and	we	believe	that	for	certain	customers	we	have	a	legally	enforceable	right	to	payment	for	performance completed	to	date	on	these	manufactured	products,	including	a	reasonable	profit.	Beginning	in	fiscal	year	2019,	for	manufactured	products	that	meet	these two	criteria,	the	Company	will	recognize	revenue	"over	time".	This	results	in	(i)	revenue	recognition	prior	to	the	date	of	shipment	or	title	transfer	for	these products,	and	(ii)	increases	the	contract	asset	(unbilled	receivables)	balance	with	a	corresponding	reduction	in	finished	goods	inventory	on	our	balance sheet.	The	Company	elected	the	modified	retrospective	implementation	approach	and	estimates	accelerating	revenue	of	approximately	$175	million	to	$225 million.	The	transition	adjustment	related	to	this	acceleration	of	revenue	along	with	the	related	costs	of	goods	sold	and	income	tax	effect	will	be	recorded	in the	opening	balance	sheet	within	retained	earnings.

The	Company	has	also	identified	and	implemented	changes	to	our	accounting	policies	and	practices,	business	processes,	systems	and	designed	and implemented	specific	controls	over	our	evaluation	of	the	impact	of	the	new	guidance	on	the	Company	upon	adoption,	and	on	an	ongoing	basis,	including disclosure	requirements	and	the	collection	of	relevant	data	into	the	reporting	process.	While	we	are	substantially	complete	with	the	process	of	quantifying the	impacts	that	will	result	from	applying	the	new	standard,	our	assessment	will	be	finalized	during	the	first	quarter	of	fiscal	2019.

# New	Accounting	Standards	-	Recently	Issued

In	August	2018,	the	FASB	issued	ASU	2018-15	" Intangibles	–	Goodwill	and	Other	–	Internal-Use	Software	(Subtopic	350-40):	Customer's	Accounting for	Implementation	Costs	Incurred	in	a	Cloud	Computing	Arrangement	That	Is	a	Service	Contract."	The	amendments	in	this	ASU	align	the	requirements	for capitalizing	implementation	costs	incurred	in	a	hosting	arrangement	that	is	a	service	contract	with	the	requirements	for	capitalizing

implementation	costs	incurred	to	develop	or	obtain	internal-use	software	(and	hosting	arrangements	that	include	an	internal-use	software	license).	The accounting	for	the	service	element	of	a	hosting	arrangement	that	is	a	service	contract	is	not	affected	by	these	amendments.	The	provisions	may	be	adopted prospectively	or	retrospectively.	This	ASU	is	effective	for	annual	periods,	including	interim	periods	within	those	annual	periods,	beginning	after	December 15,	2019.	Early	adoption	is	permitted.	We	are	currently	evaluating	the	impact	of	this	ASU.

In	August	2018,	the	FASB	issued	ASU	2018-14	" Compensation	–	Retirement	Benefits	–	Defined	Benefit	Plans	–	General	(Subtopic	715-20):	Changes to	the	Disclosure	Requirements	for	Defined	Benefit	Plans."	The	amendments	in	this	ASU	modify	the	disclosure	requirements	for	employers	that	sponsor defined	benefit	pension	or	other	postretirement	plans	to	remove	disclosures	that	no	longer	are	considered	cost	beneficial,	clarify	the	specific	requirements of	disclosures,	and	add	disclosure	requirements	identified	as	relevant.	These	provisions	will	be	applied	retrospectively.	This	ASU	is	effective	for	fiscal	years ending	after	December	15,	2020.	Early	adoption	is	permitted.	We	are	currently	evaluating	the	impact	of	this	ASU.

In	 August	 2018, the	 FASB issued	 ASU	 2018-13 " Fair	 Value	 Measurement (Topic	 820):	 Disclosure	 Framework	 –	 Changes to the	 Disclosure Requirements	for	Fair	Value	Measurement".	The	guidance in	 this	ASU	eliminates	certain	disclosure	requirements	 for	 fair	value	measurements	 for	all entities,	requires	public	entities	to	disclose	certain	new	information	and	modifies	some	disclosure	requirements.	Entities	are	no	longer	required	to	disclose the	amount	of	and	reasons	for	transfers	between	Level	1	and	Level	2	of	the	fair	value	hierarchy	but	require	public	companies	to	disclose	the	range	and weighted	average	used	to	develop	significant	unobservable	inputs	for	Level	3	fair	value	measurements.	Certain	provisions	are	applied	prospectively	while others	are	applied	retrospectively.	This	ASU	is	effective	for	fiscal	years,	and	interim	periods	within	those	fiscal	years,	beginning	after	December	15,	2019. Early	adoption	is	permitted.	We	do	not	expect	the	adoption	of	this	ASU	to	have	a	material	impact	on	our	consolidated	financial	statements.

In	June	2018,	the	FASB	issued	ASU	2018-07	" Compensation	–	Stock	Compensation	(Topic	718):	 Improvements to	Nonemployee	Share-Based Payment	Accounting".	The	amendments	 in	 this	ASU	expand	 the	scope	of	ASC	718,	" Compensation	–	Stock	Compensation"	 to	 include	 share-based payment	transactions	for	acquiring	goods	and	services	from	nonemployees.	An	entity	should	apply	the	requirements	of	ASC	718	to	nonemployee	awards, except	for	specific	guidance	on	inputs	to	an	option	pricing	model	and	the	attribution	of	cost	(that	is,	the	period	of	time	over	which	share-based	payment awards	vest	and	the	pattern	of	cost	recognition	over	that	period).	The	amendments	specify	that	ASC	718	applies	to	all	share-based	payment	transactions	in which	 a	 grantor	 acquires	 goods	 or	 services	 to	 be	 used	 or	 consumed	 in	 a	 grantor's	 own	 operations	 by	 issuing	 share-based	 payment	 awards.	 The amendments	also	clarify	that	ASC	718	does	not	apply	to	share-based	payments	used	to	effectively	provide	(i)	financing	to	the	issuer	or	(ii)	awards	granted in	conjunction	with	selling	goods	or	services	 to	customers	as	part	of	a	contract	accounted	 for	under	ASC	606.	This	ASU	 is	effective	 for	 fiscal	years beginning	after	December	15,	2018,	and	early	adoption	is	permitted	but	not	earlier	than	our	adoption	of	ASC	606.	We	do	not	expect	the	adoption	of	this ASU	to	have	a	material	impact	on	our	consolidated	financial	statements.

In	February	2018,	the	FASB	issued	ASU	2018-02,	" Income	Statement	–	Reporting	Comprehensive	Income	(Topic	220):	Reclassification	of	Certain Tax	Effects	from	Accumulated	Other	Comprehensive	Income".	The	amendments	in	this	update	provide	financial	statement	preparers	with	an	option	to reclassify	stranded	tax	effects	within	accumulated	other	comprehensive	income	to	retained	earnings	in	each	period	in	which	the	effect	of	the	change	in	the Tax	Act	(or	portion	thereof)	is	recorded.	The	ASU	requires	financial	statement	preparers	to	disclose	(i)	a	description	of	the	accounting	policy	for	releasing income	tax	effects	from	accumulated	other	comprehensive	income;	(ii)	whether	they	elect	to	reclassify	the	stranded	income	tax	effects	from	the	Tax	Act; and	(iii)	information	about	the	other	income	tax	effects	that	are	reclassified.	The	amendments	affect	any	organization	that	is	required	to	apply	the	provisions of	ASC	220,	"Income	Statement:	Reporting	Comprehensive	Income",	and	has	items	of	other	comprehensive	income	for	which	the	related	tax	effects	are presented	in	other	comprehensive	income	as	required	by	GAAP.	The	ASU	is	effective	for	interim	and	annual	reporting	periods	beginning	after	December 15,	2018,	and	early	adoption	is	permitted.	We	are	currently	evaluating	the	impact	of	this	ASU.

In	August	2017,	 the	FASB issued	ASU	2017-12,	" Derivatives	and	Hedging:	Targeted Improvements to	Accounting for	Hedging	Activities ".	 The amendments	in	this	ASU	better	align	an	entity's	risk	management	activities	and	financial	reporting	for	hedging	relationships	through	changes	to	both	the designation	and	measurement	guidance	for	qualifying	hedging	relationships	and	the	presentation	of	hedge	results.	To	meet	that	objective,	the	amendments expand	and	refine	hedge	accounting	for	both	nonfinancial	and	financial	risk	components	and	align	the	recognition	and	presentation	of	the	effects	of	the hedging	instrument	and	the	hedged	item	in	the	financial

statements.	The	amendments	in	this	ASU	also	make	certain	targeted	improvements	to	simplify	the	application	of	hedge	accounting	guidance	and	ease	the administrative	burden	of	hedge	documentation	requirements	and	assessing	hedge	effectiveness.	These	provisions	are	effective	for	fiscal	years	beginning after	December	15,	2019	(October	1,	2020	for	us),	including	interim	periods	within	those	fiscal	years,	and	should	be	applied	prospectively.	Early	adoption	is permitted.	 We	 are	 currently	 evaluating	 the	 impact	 of	 this	ASU	 but	 do	 not	 expect	 this	ASU	 to	 have	 a	 material	 impact	 on	 our	 consolidated	 financial statements.

In	January	2017,	the	FASB	issued	ASU	2017-04,	" Simplifying	the	Test	for	Goodwill	Impairment",	which	amends	the	guidance	in	ASC	350,	" Intangibles –	Goodwill	and	Other".	The	ASU	eliminates	the	requirement	to	calculate	the	implied	fair	value	of	goodwill	to	measure	a	goodwill	impairment	charge.	Instead, entities	will	record	an	impairment	charge	based	on	the	excess	of	a	reporting	unit's	carrying	amount	over	its	fair	value.	The	ASU	is	effective	for	annual	and interim	impairment	tests	performed	in	periods	beginning	after	December	15,	2019.	Early	adoption	is	permitted	for	annual	and	interim	goodwill	impairment testing	dates	after	January	1,	2017.	The	ASU	will	be	applied	prospectively	upon	adoption.	We	currently	do	not	expect	that	the	adoption	of	these	provisions will	have	a	material	effect	on	our	consolidated	financial	statements.

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	ASC	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	with respect	to	credit	quality	indicators,	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	(October	1,	2020	for	us),	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	currently	do	not	expect	that	the	adoption	of	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.	Prior	to	the	FASB	issuing	ASU	2018-11	"Leases", entities	were	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.	In	July	2018,	the	FASB	issued	ASU	2018-11,	which	provides	entities	the	option	to	initially	apply	ASU	2016-02 at	the	adoption	date	and	recognize	a	cumulative-effect	adjustment	to	the	opening	balance	of	retained	earnings	in	the	period	of	adoption.	Consequently,	the comparative	periods	presented	in	the	financial	statements	would	continue	to	be	in	accordance	with	current	GAAP.	While	we	have	not	completed	our assessment,	we	expect	that	the	adoption	of	ASC	842	as	of	October	1,	2019	will	result	in	recording	additional	assets	and	liabilities	not	previously	reflected	on our	consolidated	balance	sheets,	but	we	do	not	expect	the	adoption	to	have	a	significant	impact	on	the	recognition,	measurement,	or	presentation	of	lease expenses	within	the	consolidated	statements	of	income	or	the	consolidated	statements	of	cash	flows.

# Note	2. Mergers,	Acquisitions	and	Investment

We	account	for	acquisitions	in	accordance	with	ASC	805,	"Business	Combinations".	The	estimated	fair	values	of	all	assets	acquired	and	liabilities assumed	in	acquisitions	are	provisional	and	may	be	revised	as	a	result	of	additional	information	obtained	during	the	measurement	period	of	up	to	one	year from	the	acquisition	date.	No	changes	in	fiscal	2018	to	our	fiscal	2017	provisional	fair	value	estimates	of	assets	and	liabilities	assumed	in	acquisitions	have been	significant.

# Schlüter	Acquisition

On	September	4,	2018,	we	completed	 the	Schlüter	Acquisition	 to	 further	enhance	our	pharmaceutical	and	automotive	platform	and	expand	our geographical	footprint	in	Europe	to	better	serve	our	customers.	In	connection	with	the	Schlüter	Acquisition,	we	paid	cash	of	$51.4	million.	The	purchase consideration	included	the	assumption	of	$7.5	million	of	debt.	We	have	included	the	financial	results	of	the	acquired	operations	in	our	Consumer	Packaging segment	since	the	date	of	the	acquisition.

The	preliminary	allocation	of	consideration	primarily	included	$9.1	million	of	customer	relationship	intangible	assets,	$23.8	million	of	goodwill,	$27.5 million	of	property,	plant	and	equipment	and	$21.5	million	of	 liabilities	 including	 deferred	 taxes	 and	 the	 aforementioned	 debt.	 We	 are	 amortizing	 the customer	relationship	intangibles	over	10.5	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,	as	well	as	due	to	establishing	deferred	taxes	for	the	difference	between	book	and	tax basis	of	the	assets	and	liabilities	acquired.	The	goodwill	and	intangibles	are	not	amortizable	for	income	tax	purposes.	We	are	in	the	process	of	reviewing	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.

# Plymouth	Packaging	Acquisition

On	 January	 5,	 2018,	we	completed	the	Plymouth	Packaging	Acquisition	to	further	enhance	our	platform	and	drive	differentiation	and	innovation. Plymouth's	"Box	on	Demand"	systems	are	located	on	customers'	sites	under	multi-year	exclusive	agreements	and	use	fanfold	corrugated	to	produce custom,	on-demand	corrugated	packaging	that	is	accurately	sized	for	any	product	type	according	to	the	customers'	specifications.	We	have	fully	integrated the	approximately	60,000	tons	of	containerboard	used	by	Plymouth	annually.	The	estimated	purchase	price	of	$201.9	million,	net	of	cash	received	of	$3.1 million,	is	subject	to	an	estimated	payment	of	$25.1	million	consisting	of	a	deferred	payment	and	a	tax	make-whole	payment	related	to	stepping	up	the assets	for	tax	purposes.	We	expect	the	payment	to	be	made	in	the	first	quarter	of	fiscal	2019.	We	have	included	the	financial	results	of	the	acquired	assets in	our	Corrugated	Packaging	segment	since	the	date	of	the	acquisition.

The	preliminary	allocation	of	consideration	primarily	included	$61.9	million	of	customer	relationship	intangible	assets,	$58.7	million	of	goodwill,	$35.2 million	of	property,	plant	and	equipment,	$26.2	million	of	other	long-term	assets	consisting	of	assets	leased	to	customers	and	equity	method	investments, and	 $12.6	 million	 of	 liabilities.	 We	 are	 amortizing	 the	 customer	 relationship	 intangibles	 over	 13.0	 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,	as	well	as	due	to	establishing deferred	taxes	for	the	difference	between	book	and	tax	basis	of	the	assets	and	liabilities	acquired.	The	goodwill	and	intangibles	are	amortizable	for	income tax	purposes.	We	are	in	the	process	of	reviewing	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.

# Grupo	Gondi	Investment

On	April	1,	2016,	we	completed	the	formation	of	a	joint	venture	with	Grupo	Gondi	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%	ownership	interest	in	the	joint	venture	together	with	future	put	and	call	rights.	The	investment	was	valued	at	approximately	$0.3	billion.	The majority	equity	holders	manage	the	joint	venture	and	we	provide	technical	and	commercial	resources	and	supply	certain	paperboard	to	the	joint	venture.	We believe	the	joint	venture	is	helping	to	grow	our	presence	in	the	attractive	Mexican	market.	The	joint	venture	operates	paper	machines,	corrugated	packaging and	high	graphic	folding	carton	facilities	across	various	production	sites.	As	a	result	of	the	transaction,	we	recorded	a	pre-tax	non-cash	gain	of	$12.1	million included	in	"Other	income,	net"	on	our	consolidated	statements	of	operations	in	fiscal	2016.	We	have	included	the	financial	results	of	the	joint	venture	in	our Corrugated	Packaging	segment	since	the	date	of	the	formation,	and	are	accounting	for	the	investment	under	the	equity	method.	On	October	20,	2017,	we increased	our	ownership	interest	in	Grupo	Gondi	from	27.0%	to	32.3%	through	a	$108	million	capital	contribution,	which	followed	the	joint	venture	entity having	a	stock	redemption	from	a	minority	partner	in	April	2017	that	increased	our	ownership	interest	to	approximately	27.0%.	The	October	2017	capital contribution	is	being	used	to	support	the	joint	venture's	capital	expansion	plans,	which	include	a	containerboard	mill	and	several	converting	plants.	The agreement	governing	our	investment	in	Grupo	Gondi	continues	to	include	future	put	and	call	rights	with	respect	to	the	respective	parties'	ownership	interest in	the	joint	venture.

# Hannapak	Acquisition

On	August	1,	2017,	we	completed	the	Hannapak	Acquisition	in	a	stock	purchase.	Hanna	Group	is	one	of	Australia's	leading	providers	of	folding cartons	to	a	variety	of	markets,	including	beverage,	food,	confectionery,	and	healthcare.	We	expect	this	acquisition	will	build	on	our	established	and	growing packaging	business	in	the	region.	The	purchase	consideration	for	the	Hannapak	Acquisition	was	$61.4	million,	net	of	cash	received	of	$0.6	million.	We have	included	the	financial	results	of	the	acquired	operations	since	the	date	of	the	acquisition	in	our	Consumer	Packaging	segment.

The	allocation	of	consideration	primarily	included	$22.2	million	of	customer	relationship	intangible	assets,	$25.3	million	of	goodwill,	$9.8	million	of property,	plant	and	equipment	and	$13.9	million	of	liabilities	including	deferred	taxes.	We	are	amortizing	the	customer	relationship	intangibles	over	13	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,	as	well	as	due	to	establishing	deferred	taxes	for	the	difference	between	book	and	tax	basis	of	the	assets	and	liabilities	acquired .	The goodwill	and	intangibles	are	not	amortizable	for	income	tax	purposes.

# Island	Container	Acquisition

On	July	17,	2017,	we	completed	the	Island	Container	Acquisition	in	an	asset	purchase.	The	assets	acquired	include	a	corrugator	and	corrugated converting	 operations	 located	 in	 Wheatley	 Heights,	 New	York,	 and	 certain	 related	 fulfillment	 assets	 located	 in	 Saddle	 Brook,	 New	 Jersey.	 We	 have substantially	completed	the	integration	of	the	80,000	tons	of	containerboard	used	by	Island	annually.	The	purchase	consideration	for	the	Island	Container Acquisition	was	$84.7	million,	including	a	working	capital	settlement	of	$1.2	million	paid	in	fiscal	2018.	We	have	included	the	financial	results	of	the	acquired assets	since	the	date	of	the	acquisition	in	our	Corrugated	Packaging	segment.

The	allocation	of	consideration	primarily	included	$43.0	million	of	customer	relationship	intangible	assets,	$27.2	million	of	goodwill,	$5.4	million	of property,	plant	and	equipment	and	$0.8	million	of	liabilities.	We	are	amortizing	the	customer	relationship	intangibles	over	8.5	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.	The goodwill	and	intangibles	are	amortizable	for	income	tax	purposes.

# U.S.	Corrugated	Acquisition

On	 June 9, 2017,	 we	 completed	 the	 U.S.	 Corrugated	 Acquisition	 in	 a	 stock	 purchase.	 We	 acquired	 five	 corrugated	 converting	 facilities in	Ohio,	Pennsylvania	and	Louisiana	that	provide	a	comprehensive	suite	of	products	and	services	to	customers	in	a	variety	of	end	markets,	including	food	& beverage,	pharmaceuticals	and	consumer	electronics.	At	the	time	of	the	transaction,	we	expected	the	acquisition	to	provide	us	the	opportunity	to	increase the	vertical	integration	of	our	Corrugated	Packaging	segment	by	approximately	105,000	tons	of	containerboard	annually	through	the	acquired	facilities	and another	50,000	tons	under	a	long-term	supply	contract	with	another	company	owned	by	the	seller,	and	we	have	since	completed	the	integration	of	these tons.

The	purchase	consideration	was	$193.7	million,	net	of	cash	received	of	$1.4	million	and	a	$3.4	million	working	capital	settlement	received	in	fiscal 2018.	The	consideration	included	the	issuance	of	2.4	million	shares	of	Common	Stock	valued	at	$136.1	million.	We	have	included	the	financial	results	of U.S.	Corrugated	since	the	date	of	the	acquisition	in	our	Corrugated	Packaging	segment.

The	allocation	of	consideration	primarily	included	$77.8	million	of	customer	relationship	intangible	assets,	$110.5	million	of	goodwill,	$30.0	million	of property,	plant	and	equipment	and	$55.5	million	of	liabilities,	including	deferred	income	taxes.	We	are	amortizing	the	customer	relationship	intangibles	over 7.5	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,	as	well	as	due	to	establishing	deferred	taxes	for	the	difference	between	book	and	tax	basis	of	the	assets	and	liabilities	acquired. The	goodwill	and	intangibles	are	not	amortizable	for	income	tax	purposes.

# MPS	Acquisition

On	June	6,	2017,	we	completed	the	MPS	Acquisition	in	a	stock	purchase.	MPS	is	a	global	provider	of	print-based	specialty	packaging	solutions	and	its differentiated	product	offering	includes	premium	folding	cartons,	inserts,	labels	and	rigid	packaging.	We	acquired	the	outstanding	shares	of	MPS	for	$18.00 per	share	in	cash	and	the	assumption	of	debt.	We	believe	the	acquisition	will	increase	our	annual	paperboard	consumption	by	approximately	225,000	tons. We	are	well	underway,	and	we	currently	expect	approximately	100,000	tons	to	be	supplied	by	us	by	the	first	half	of	fiscal	2019.

In	connection	with	the	MPS	Acquisition,	we	paid	cash	of	$1,351.1	million,	net	of	cash	received	of	$47.5	million.	The	purchase	consideration	included the	assumption	of	$929.1	million	of	debt	and	$1.9	million	related	to	MPS	equity	awards	that	were	replaced	with	WestRock	equity	awards	with	identical	terms for	the	pre-acquisition	service.	The	amount	related	to	post-acquisition	service	is	being	expensed	over	the	remaining	service	period	of	the	awards.	See	"Note 20.	Share-Based	Compensation"	for	additional	information	on	the	converted	awards.	We	have	included	the	financial	results	of	MPS	since	the	date	of	the acquisition	in	our	Consumer	Packaging	segment.

The	allocation	of	consideration	primarily	included	$1,026.4	million	of	intangible	assets,	$900.9	million	of	goodwill,	$469.9	million	of	property,	plant	and equipment	and	$1,561.6	million	of	liabilities	and	noncontrolling	interests,	including	debt	and	deferred	income	taxes.	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,	as	well	as	due	to	establishing	deferred	taxes	for	the	difference	between	book	and	tax	basis	of	the	assets	and liabilities	acquired.	The	goodwill	and	intangibles	are	not	amortizable	for	income	tax	purposes.

The	following	table	summarizes	the	weighted	average	life	and	the	allocation	to	intangible	assets	recognized	in	the	MPS	Acquisition,	excluding	goodwill (in	millions):

|  | Weighted	Avg. | the	Acquisition |
| :--- | :--- | :--- |
|  | Life | Date |
| Customer\trelationships | 14.6 | $1,008.7 |
| Trademarks\tand\ttradenames | 3.0 | 15.2 |
| Photo\tlibrary | 10.0 | 2.5 |
| Total | 14.4 | $1,026.4 |

None	of	the	intangibles	has	significant	residual	value.	We	are	amortizing	the	customer	relationship	intangibles	over	estimated	useful	lives	ranging	from 13	to	16	years	based	on	a	straight-line	basis	because	the	amortization	pattern	was	not	reliably	determinable.

# Star	Pizza	Acquisition

On	March	13,	2017,	we	completed	the	Star	Pizza	Acquisition.	The	transaction	provided	us	with	a	leadership	position	in	the	fast	growing	small-run pizza	box	market	and	increases	our	vertical	integration.	The	purchase	price	was	$34.6	million,	net	of	a	$0.7	million	working	capital	settlement.	We	have	fully integrated	the	approximately	22,000	tons	of	containerboard	used	by	Star	Pizza	annually.	We	have	included	the	financial	results	of	the	acquired	assets	since the	date	of	the	acquisition	in	our	Corrugated	Packaging	segment.

The	purchase	price	allocation	for	the	acquisition	primarily	included	$24.8	million	of	customer	relationship	intangible	assets	and	$2.2	million	of	goodwill. We	are	amortizing	the	customer	relationship	intangibles	over	10	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.	The	goodwill	and	intangibles	are	amortizable	for	income	tax purposes.

# Packaging	Acquisition

On	January	19,	2016,	we	completed	the	Packaging	Acquisition.	The	entities	acquired	provide	value-added	folding	carton	and	litho-laminated	display packaging	solutions.	The	purchase	price	was	$94.1	million,	net	of	cash	received	of	$1.7	million,	a	working	capital	settlement	and	a	$3.5	million	escrow receipt	in	the	first	quarter	of	fiscal	2017.	The	transaction	is	subject	to	an	election	under	Section	338(h)(10)	of	the	Code	that	increases	the	U.S.	tax	basis	in the	acquired	U.S.	entities.	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	 purchase	 price	 allocation	 for	 the	 acquisition	 primarily	 included	 $55.0	 million	 of	 property,	 plant	 and	 equipment,	 $10.5	 million	 of	 customer relationship	 intangible	 assets,	 $9.3	 million	 of	 goodwill	 and	 $25.8	 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.	The	goodwill	and	intangibles	of	the	U.S.	entities	are amortizable	for	income	tax	purposes.

# SP	Fiber

On	October	1,	2015,	we	completed	the	SP	Fiber	Acquisition	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%	interest	in	GPS.	GPS	is	a	joint	venture	providing	steam	to	the	Dublin	mill	and	electricity	to	Georgia	Power.	The purchase	price	was	$278.8	million,	net	of	cash	received	of	$9.2	million	and	a	working	capital	settlement.	In	addition,	we	paid	$36.5	million	for	debt	owed	by GPS	and	thereby	own	the	majority	of	the	debt	issued	by	GPS.

The	 Dublin	 mill	 has	 helped	 balance	 the	 fiber	 mix	 of	 our	 mill	 system,	 including	 our	 ability	 to	 serve	 the	 increasing	 demand	 for	 lighter	 weight containerboard,	and	the	addition	of	kraft	and	bag	paper	has	diversified	our	product	offering.	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	 purchase	 price	 allocation	 for	 the	 acquisition	 primarily	 included	 $324.8	 million	 of	 property,	 plant	 and	 equipment,	 $13.5	 million	 of	 customer relationship	intangible	assets,	$57.3	million	of	goodwill,	and	$150.3	million	of	liabilities	and	noncontrolling	interests,	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	difference	between	the	book	to	tax	basis	of	the	assets	and	liabilities	acquired.	The	goodwill	and	intangibles	are	not amortizable	for	income	tax	purposes.

# Note	3. Restructuring	and	Other	Costs

# Summary	of	Restructuring	and	Other	Initiatives

We	recorded	pre-tax	restructuring	and	other	costs	of	$105.4	million,	$196.7	million	and	$366.4	million	for	fiscal	2018,	2017	and	2016,	respectively.	Of these	costs,	$27.0	million,	$86.6	million	and	$200.2	million	were	non-cash	for	fiscal	2018,	2017	and	2016,	respectively.	These	amounts	are	not	comparable since	the	timing	and	scope	of	the	individual	actions	associated	with	each	restructuring,	acquisition,	divestiture	or	integration	vary.	The	restructuring	and other	costs	exclude	the	Specialty	Chemicals	costs	which	are	included	in	discontinued	operations	in	fiscal	2016.	We	present	our	restructuring	and	other costs	in	more	detail	below	and	those	charged	to	discontinued	operations	in	"Note	7.	Discontinued	Operations".

The	following	table	summarizes	our	Restructuring	and	other	costs	for	fiscal	2018,	2017	and	2016	(in	millions):

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Restructuring | $39.5 | $113.4 | $294.9 |
| Other | 65.9 | 83.3 | 71.5 |
| Restructuring\tand\tOther\tCosts | $105.4 | $196.7 | $366.4 |

# Restructuring

Our	restructuring	charges	are	primarily	associated	with	costs	of	plant	closures	and	employee	costs	due	to	merger	and	acquisition-related	workforce reductions.	When	we	close	a	facility,	if	necessary,	we	recognize	a	write-down	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	unless	the	actual	selling	price exceeds	the	original	carrying	value	when	sold.	At	the	time	of	each	announced	closure,	we	generally	expect	to	record	future	period	costs	for	equipment relocation,	facility	carrying	costs,	costs	to	terminate	a	lease	or	contract	before	the	end	of	its	term	and	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	and/or	further	optimize	our	system following	mergers	and	acquisitions	or	a	changing	business	environment.	Therefore,	we	have	transferred	a	substantial	portion	of	each	closed	plant's	assets and	production	to	our	other	plants.	We	believe	these	actions	have	allowed	us	to	more	effectively	manage	our	business.	In	our	Land	and	Development segment,	the	restructuring	charges	primarily	consisted	of	severance	and	other	employee	costs	associated	with	the	accelerated	monetization	strategy	and wind-down	of	operations	and	lease	costs.

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	charges	related	to	active	restructuring	initiatives	that	we	incurred	during	the	last three	fiscal	years,	the	cumulative	recorded	amount	since	we	started	the	initiative,	and	our	estimate	of	the	total	we	expect	to	incur	(in	millions):

|  | 2018 | 2017 | 2016 | Cumulative | Expected |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Corrugated\tPackaging |  |  |  |  |  |
| Net\tproperty,\tplant\tand\tequipment\tcosts | \t $2.8 | \t $1.4 | \t $184.5 | \t $211.5 | \t $211.5 |
| Severance\tand\tother\temployee\tcosts | 1.6 | 3.3 | 17.4 | 42.2 | 42.8 |
| Equipment\tand\tinventory\trelocation\tcosts | 3.1 | 1.9 | 0.3 | 7.1 | 7.1 |
| Facility\tcarrying\tcosts | 3.2 | 5.4 | 18.9 | 36.7 | 37.9 |
| Other\tcosts | (0.1) | (1.2) | 9.1 | 19.1 | 19.1 |
| Restructuring\ttotal | \t $10.6 | \t $10.8 | \t $230.2 | \t $316.6 | \t $318.4 |
| Consumer\tPackaging |  |  |  |  |  |
| Net\tproperty,\tplant\tand\tequipment\tcosts | \t $6.9 | \t $28.3 | \t $3.8 | \t $41.6 | \t $41.6 |
| Severance\tand\tother\temployee\tcosts | 7.2 | 26.4 | 4.6 | 41.0 | 41.2 |
| Equipment\tand\tinventory\trelocation\tcosts | 2.7 | 2.8 | 1.1 | 7.4 | 7.9 |
| Facility\tcarrying\tcosts | 1.0 | 0.7 | 0.5 | 3.4 | 4.0 |
| Other\tcosts\t(1) | 2.2 | 20.2 | — | 22.9 | 22.9 |
| Restructuring\ttotal | \t $20.0 | \t $78.4 | \t $10.0 | \t $116.3 | \t $117.6 |
| Land\tand\tDevelopment |  |  |  |  |  |
| Net\tproperty,\tplant\tand\tequipment\tcosts | \t $— | \t $1.8 | \t $— | \t $1.8 | \t $1.8 |
| Severance\tand\tother\temployee\tcosts | 0.3 | 2.8 | 10.6 | 13.7 | 13.7 |
| Other\tcosts | 3.0 | \t $— | \t $— | 3.0 | 3.0 |
| Restructuring\ttotal | \t $3.3 | \t $4.6 | \t $10.6 | \t $18.5 | \t $18.5 |
| Corporate |  |  |  |  |  |
| Net\tproperty,\tplant\tand\tequipment\tcosts | \t $— | \t $0.1 | \t $1.2 | \t $1.4 | \t $1.4 |
| Severance\tand\tother\temployee\tcosts | 0.8 | 14.8 | 36.9 | 100.6 | 100.6 |
| Other\tcosts | 4.8 | 4.7 | 6.0 | 15.5 | 15.5 |
| Restructuring\ttotal | \t $5.6 | \t $19.6 | \t $44.1 | \t $117.5 | \t $117.5 |
| Total |  |  |  |  |  |
| Net\tproperty,\tplant\tand\tequipment\tcosts | \t $9.7 | \t $31.6 | \t $189.5 | \t $256.3 | \t $256.3 |
| Severance\tand\tother\temployee\tcosts | 9.9 | 47.3 | 69.5 | 197.5 | 198.3 |
| Equipment\tand\tinventory\trelocation\tcosts | 5.8 | 4.7 | 1.4 | 14.5 | 15.0 |
| Facility\tcarrying\tcosts | 4.2 | 6.1 | 19.4 | 40.1 | 41.9 |
| Other\tcosts | 9.9 | 23.7 | 15.1 | 60.5 | 60.5 |
| Restructuring\ttotal | \t $39.5 | \t $113.4 | \t $294.9 | \t $568.9 | \t $572.0 |

(1) Includes	a	$17.6	million	impairment	of	a	customer	relationship	intangible	in	fiscal	2017	related	to	an	exited	product	line.

We	have	defined	"Net	property,	plant	and	equipment	costs "	as	used	in	this	Note	3	as	property,	plant	and	equipment	write-downs,	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	on	such	assets,	if	any.

# Other	Costs

Our	other	costs	consist	of	acquisition,	integration	and	divestiture	costs.	We	incur	costs	when	we	acquire	or	divest	businesses.	Acquisition	costs include	costs	associated	with	transactions,	whether	consummated	or	not,	such	as	advisory,	legal,	accounting,	valuation	and	other	professional	or	consulting fees,	as	well	as	potential	 litigation	costs	associated	with	 those	 activities.	 We	 incur	 integration	 costs	 pre-	 and	 post-acquisition	 that	 reflect	 work	 being performed	to	facilitate	merger	and	acquisition	integration,	such	as	work	associated	with	information	systems	and	other	projects	including	spending	to support	future	acquisitions,	and	primarily	consist	of	professional	services.	Divestiture	costs	consist	primarily	of	similar	professional	fees.	The	divestiture costs	in	fiscal	2017	were	primarily	associated	with	costs	incurred	during	the	HH&B	Sale	process.	We	consider	acquisition,	integration	and	divestiture	costs to	be	Corporate	costs	regardless	of	the	segment	or	segments	involved	in	the	transaction.

The	following	table	presents	our	acquisition,	divestiture	and	integration	costs	that	we	incurred	during	the	last	three	fiscal	years	(in	millions):

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Acquisition\tcosts | $38.2 | $27.1 | $8.9 |
| Integration\tcosts | 27.4 | 46.4 | 62.1 |
| Divestiture\tcosts | 0.3 | 9.8 | 0.5 |
| Other\ttotal | $65.9 | $83.3 | $71.5 |

	The	following	table	summarizes	the	changes	in	the	restructuring	accrual,	which	are	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"	on	our	consolidated statements	of	operations	for	the	last	three	fiscal	years	(in	millions):

# Note	4. Retirement	Plans

We	have	defined	benefit	pension	plans	and	other	postretirement	benefit	plans	for	certain	U.S.	and	non-U.S.	employees.	Certain	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,	we	participate	in	several	MEPPs	that	provide	retirement	benefits	to	certain	union	employees	in	accordance	with	various	collective	bargaining agreements.	 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	the	Plan.	The	other	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	benefits	under	our	defined	benefit	pension	plans	are	based	on	either	compensation	or	a	combination	of	years	of	service	and	negotiated	benefit levels,	depending	upon	the	plan.	We	allocate	our	pension	assets	to	several	investment	management	firms	across	a	variety	of	investment	styles.	Our	defined benefit	Investment	Committee

meets	at	least	four	times	a	year	with	our	investment	advisors	to	review	each	management	firm's	performance	and	monitors	its	compliance	with	its	stated goals,	our	investment	policy	and	applicable	regulatory	requirements	in	the	U.S.,	Canada,	and	other	jurisdictions.

Investment	returns	vary.	We	believe	that,	by	investing	in	a	variety	of	asset	classes	and	utilizing	multiple	investment	management	firms,	we	can	create a	portfolio	that	yields	adequate	returns	with	reduced	volatility.	Our	qualified	U.S.	plans	employ	a	liability	matching	strategy	augmented	with	Treasury	futures to	generally	fully	hedge	against	interest	rate	risk.	After	we	consulted	with	our	actuary	and	investment	advisors,	we	adopted	the	target	allocations	in	the	table that	 follows	 for	our	pension	plans	 to	produce	 the	desired	performance.	These	 target	allocations	are	guidelines,	not	 limitations,	and	occasionally	plan fiduciaries	will	approve	allocations	above	or	below	target	ranges	or	modify	the	allocations.

# Target	Allocations

We	manage	our	retirement	plans	in	accordance	with	the	provisions	of	the	Employee	Retirement	Income	Security	Act	of	1974,	as	amended,	and	the rules	and	regulations	thereunder	("ERISA")	as	well	as	applicable	legislation	in	Canada	and	other	foreign	countries.	Our	investment	policy	objectives	include maximizing	long-term	returns	at	acceptable	risk	levels,	diversifying	among	asset	classes,	as	applicable,	and	among	investment	managers,	as	well	as establishing	certain	risk	parameters	within	asset	classes.	We	have	allocated	our	investments	within	the	equity	and	fixed	income	asset	classes	to	sub-asset classes	designed	to	meet	these	objectives.	In	addition,	our	other	investments	support	multi-strategy	objectives.

In	developing	our	weighted	average	expected	rate	of	return	on	plan	assets,	we	consulted	with	our	investment	advisors	and	evaluated	criteria	based	on historical	returns	by	asset	class	and	long-term	return	expectations	by	asset	class.	We	use	a	September	30	measurement	date.	We	expect	to	contribute approximately	$22	million	to	our	U.S.	and	non-U.S.	pension	plans	in	fiscal	2019.	However,	it	is	possible	that	our	assumptions	or	legislation	may	change, actual	market	performance	may	vary	or	we	may	decide	to	contribute	a	different	amount.	Therefore,	the	amount	we	contribute	may	vary	materially.	The expense	for	MEPPs	for	collective	bargaining	employees	generally	equals	the	contributions	for	these	plans,	excluding	estimated	accruals	for	withdrawal liabilities.

The	weighted	average	assumptions	used	to	measure	the	benefit	plan	obligations	at	September	30,	were:

|  | U.S.	Plans | Plans |  | U.S.	Plans | Plans |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Discount\trate | 4.50% |  | 3.42% | 4.09% |  | 3.26% |
| Rate\tof\tcompensation\tincrease | 3.00% |  | 2.67% | 3.00% |  | 3.17% |

We	determine	the	discount	rate	with	the	assistance	of	actuaries.	At	September	30,	2018,	the	discount	rate	for	the	U.S.	pension	plans	was	determined based	on	the	yield	on	a	theoretical	portfolio	of	high-grade	corporate	bonds,	and	the	discount	rate	for	the	non-U.S.	plans	was	determined	based	on	a	yield curve	developed	by	our	actuary.	The	theoretical	portfolio	of	high-grade	corporate	bonds	used	to	select	the	September	30,	2018	discount	rate	for	the	U.S. pension	plans	includes	bonds	generally	rated	Aa-	or	better	with	at	least	$100	million	outstanding	par	value	and	bonds	that	are	non-callable	(unless	the bonds	possess	a	"make	whole"	feature).	The	theoretical	portfolio	of	bonds	has	cash	flows	that	generally	match	our	expected	benefit	payments	in	future years.

Our	assumption	regarding	the	future	rate	of	compensation	increases	is	reviewed	periodically	and	is	based	on	both	our	internal	planning	projections and	recent	history	of	actual	compensation	increases.

We	typically	review	our	expected	long-term	rate	of	return	on	plan	assets	periodically	through	an	asset	allocation	study	with	either	our	actuary	or investment	advisor.	In	fiscal	2019,	our	expected	rate	of	return	used	to	determine	net	periodic	benefit	cost	is	6.50%	for	our	U.S.	plans	and	4.69%	for	our	non- U.S.	plans.	Our	expected	rates	of	return	in	fiscal	2019	are	based	on	an	analysis	of	our	long-term	expected	rate	of	return	and	our	current	asset	allocation.

During	the	second	quarter	of	fiscal	2017,	our	year-to-date	lump	sum	payments	to	certain	beneficiaries	of	the	Plan,	together	with	several	one-time severance	benefit	payments	out	of	the	Plan,	triggered	pension	settlement	accounting	and	a	remeasurement	of	the	Plan	as	of	February	28,	2017.	As	a	result of	settlement	accounting,	we	recognized	as	a	current	period	expense	a	pro-rata	portion	of	the	unamortized	net	actuarial	loss,	after	remeasurement,	and recorded	a	$28.7	million	non-cash	charge	to	our	earnings	in	the	second	quarter	of	2017.	The	lump	sum	payments	were	to	certain	eligible	former	employees who	were	not	currently	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.	Lump	sum	and	one-time	severance	benefits	payments	of	$203.7	million	were	made	out	of	existing	assets	of	the	Plan	in	the	first	half	of	fiscal 2017.	The	discount	rate	used	in	the	plan	remeasurement	was	4.49%,	an	increase	from	4.04%	for	the	Plan	at	September	30,	2016.	The	expected	long-term rate	of	return	on	plan	assets	was	unchanged.	As	a	result	of	the	February	28,	2017	remeasurement,	the	funded	status	of	the	Plan	increased	by	$73.2	million as	compared	to	September	30,	2016.	The	increase	in	the	funded	status	was	primarily	due	to	a	reduction	in	the	plan	obligations	due	to	the	increase	in	the discount	rate.	In	the	second	half	of	fiscal	2017,	we	made	$	27.1	million	in	lump	sum	payments	to	certain	beneficiaries	of	the	Plan,	resulting	in	total	fiscal 2017	lump	sum	payments	of	$230.8	million	and	a	total	fiscal	2017	non-cash	charge	to	our	earnings	of	$32.6	million.

On	September	21,	2016,	we	used	plan	assets	to	settle	$2.5	billion	in	pension	obligations	of	the	Plan	by	purchasing	group	annuity	contracts	from Prudential.	This	transaction	transferred	payment	responsibility	to	Prudential	for	retirement	benefits	owed	to	approximately	35,000	U.S.	retirees	and	their beneficiaries.	As	a	result	of	the	transaction,	we	recorded	a	non-cash	charge	of	$370.7	million	pre-tax.	The	settlement	reduced	our	overall	U.S.	pension obligations	and	assets	by	approximately	40%.	The	monthly	retirement	benefit	payment	amounts	currently	received	by	retirees	and	their	beneficiaries	did	not change	as	a	result	of	this	transaction.	Those	Plan	participants	not	included	in	the	transaction	remain	in	the	Plan,	and	responsibility	for	payment	of	the retirement	benefits	remains	with	us.

In	October	2014,	we	entered	into	a	master	agreement	with	the	USW	that	applied	to	substantially	all	of	our	legacy	RockTenn	facilities	represented	by the	USW	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,	substance	abuse	testing	and	successorship.	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.

The	following	table	shows	the	changes	in	benefit	obligation	and	plan	assets,	and	the	plan's	funded	status	for	the	years	ended	September	30	(in millions):

|  | U.S.	Plans | Non-U.S.<br>Plans | U.S.	Plans | Non-U.S.<br>Plans |
| :--- | :--- | :--- | :--- | :--- |
| Change\tin\tprojected\tbenefit\tobligation: |  |  |  |  |
| Benefit\tobligation\tat\tbeginning\tof\tfiscal\tyear | $3,941.9 | $1,502.2 | $4,231.7 | $925.2 |
| Service\tcost | 36.7 | 8.0 | 38.0 | 7.1 |
| Interest\tcost | 157.7 | 46.9 | 165.2 | 32.6 |
| Amendments | 9.3 | — | 3.5 | — |
| Actuarial\tgain | (186.8) | (90.3) | (149.1) | (57.6) |
| Plan\tparticipant\tcontributions | — | 2.5 | — | 1.7 |
| Special\ttermination\tbenefits | — | — | 12.5 | — |
| Benefits\tpaid | (175.3) | (82.8) | (141.4) | (65.1) |
| Business\tcombinations | — | 3.5 | — | 621.0 |
| Curtailments | — | (0.7) | — | — |
| Settlements | — | (5.5) | (229.3) | (0.4) |
| Foreign\tcurrency\trate\tchanges | — | (43.6) | — | 65.1 |
| Other\tadjustments | — | — | 10.8 | — |
| Business\tdivestitures | — | — | — | (27.4) |
| Benefit\tobligation\tat\tend\tof\tfiscal\tyear | $3,783.5 | $1,340.2 | $3,941.9 | $1,502.2 |
| Change\tin\tplan\tassets: |  |  |  |  |
| Fair\tvalue\tof\tplan\tassets\tat\tbeginning\tof\tfiscal\tyear | $4,107.9 | $1,414.7 | $4,301.5 | $774.1 |
| Actual\t(loss)\tgain\ton\tplan\tassets | (24.9) | 39.9 | 104.2 | 2.4 |
| Employer\tcontributions | 13.5 | 24.2 | 15.3 | 19.2 |
| Plan\tparticipant\tcontributions | — | 2.5 | — | 1.7 |
| Benefits\tpaid | (175.3) | (82.8) | (141.4) | (65.1) |
| Business\tcombinations | — | 0.7 | — | 622.1 |
| Settlements | — | (5.5) | (229.3) | (0.4) |
| Business\tdivestitures | — | — | — | (0.7) |
| Foreign\tcurrency\trate\tchanges | — | (43.5) | — | 61.4 |
| Other\tadjustments | — | — | 57.6 | — |
| Fair\tvalue\tof\tplan\tassets\tat\tend\tof\tfiscal\tyear | $3,921.2 | $1,350.2 | $4,107.9 | $1,414.7 |
| Funded\tstatus | $137.7 | $10.0 | $166.0 | $(87.5) |
| Amounts\trecognized\tin\tthe\tconsolidated\tbalance\tsheet: |  |  |  |  |
| Non-current\tassets | $305.7 | $114.3 | $340.4 | $27.6 |
| Other\tcurrent\tliability | (10.1) | (0.9) | (9.3) | (0.8) |
| Accrued\tpension\tand\tother\tlong-term\tbenefits | (157.9) | (103.4) | (165.1) | (114.3) |
| Over\t(under)\tfunded\tstatus\tat\tend\tof\tfiscal\tyear | $137.7 | $10.0 | $166.0 | $(87.5) |

Although	the	U.S.	pension	plans	were	in	a	net	over	funded	position	at	September	30,	2018,	certain	U.S.	plans	have	benefit	obligations	in	excess	of plan	 assets.	 These	 plans,	 that	 consist	 primarily	 of	 non-qualified	 plans,	 have	 aggregate	 projected	 benefit	 obligations	 of	 $197.0	 million,	 aggregate accumulated	benefit	obligations	of	$195.3	million,	and	aggregate	fair	value	of	plan	assets	of	$29.5	million	at	September	30,	2018.

The	pre-tax	amounts	in	accumulated	other	comprehensive	loss	at	September	30	not	yet	recognized	as	components	of	net	periodic	pension	cost, including	noncontrolling	interest,	consist	of	(in	millions):

|  | U.S.	Plans | Non-U.S.<br>Plans | U.S.	Plans | Non-U.S.<br>Plans |
| :--- | :--- | :--- | :--- | :--- |
| Net\tactuarial\tloss | $631.2 | $105.6 | $547.3 | $173.9 |
| Prior\tservice\tcost | 32.3 | 0.3 | 27.6 | 0.4 |
| Total\taccumulated\tother\tcomprehensive\tloss | $663.5 | $105.9 | $574.9 | $174.3 |

The	pre-tax	amounts	recognized	in	other	comprehensive	(income)	loss,	including	noncontrolling	interest,	are	as	follows	at	September	30	(in	millions):

|  |  | Pension	Plans |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Net\tactuarial\tloss\t(gain)\tarising\tduring\tperiod | $38.7 | $(48.8) | $355.4 |
| Amortization\tand\tsettlement\trecognition\tof\tnet\tactuarial\tloss | (20.6) | (57.7) | (381.6) |
| Prior\tservice\tcost\tarising\tduring\tperiod | 9.3 | 3.4 | 1.5 |
| Amortization\tof\tprior\tservice\tcost | (4.7) | (4.1) | (3.9) |
| Net\tother\tcomprehensive\tloss\t(income)\trecognized | $22.7 | $(107.2) | $(28.6) |

The	net	periodic	pension	cost	recognized	in	the	consolidated	statements	of	operations	is	comprised	of	the	following	for	fiscal	years	ended	(in	millions):

|  |  | Pension	Plans |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Service\tcost | $44.8 | $45.1 | $51.4 |
| Interest\tcost | 204.6 | 197.8 | 310.3 |
| Expected\treturn\ton\tplan\tassets | (328.4) | (313.1) | (412.3) |
| Amortization\tof\tnet\tactuarial\tloss | 21.2 | 25.4 | 11.0 |
| Amortization\tof\tprior\tservice\tcost | 4.7 | 4.1 | 3.9 |
| Curtailment\tgain | (0.6) | — | (1.6) |
| Settlement\t(gain)\tloss | (0.5) | 32.7 | 370.7 |
| Special\ttermination\tbenefits | — | 12.5 | 18.4 |
| Company\tdefined\tbenefit\tplan\t(income)\texpense | (54.2) | 4.5 | 351.8 |
| Multiemployer\tand\tother\tplans | 1.4 | 4.7 | 5.8 |
| Net\tpension\t(income)\tcost | $(52.8) | $9.2 | $357.6 |

The	Multiemployer	and	other	plans	line	in	the	table	above	excludes	the	estimated	withdrawal	liabilities	recorded	in	fiscal	2018.	For	additional	information, see	"Note	 4.	 Retirement	 Plans	 —	 Multiemployer	 Plans ".	The fiscal	 2017	 and	 2016	 special	 termination	 benefits	 were	 recorded	 to	 restructuring	 in connection	with	the	Combination,	and	are	excluded	from	the	calculation	of	pension	funding	more	than	expense.

Weighted-average	assumptions	used	in	the	calculation	of	benefit	plan	expense	for	fiscal	years	ended:

|  | 2018 |  | Pension	Plans<br>2017 |  | 2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | U.S.\nPlans | Non-U.S.\nPlans | U.S.\nPlans | Non-U.S.\nPlans | U.S.\nPlans | Non-U.S.\nPlans |
| Discount\trate | 4.09% | 3.26% | 4.30% | 3.08% | 4.70% | 3.89% |
| Rate\tof\tcompensation\tincrease | 3.00% | 2.65% | 3.00% | 3.09% | 2.50% | 3.10% |
| Expected\tlong-term\trate\tof\treturn\ton |  |  |  |  |  |  |
| \t\t\tplan\tassets | 6.50% | 4.98% | 6.50% | 6.03% | 5.88% | 6.34% |

In	fiscal	2018,	2017	and	2016,	for	our	U.S.	pension	and	postretirement	plans,	we	considered	the	mortality	tables	from	the	Society	of	Actuaries	and evaluated	our	mortality	experience	to	establish	mortality	assumptions.	Based	on	our	experience	and	in	consultation	with	our	actuaries,	we	utilized	the	base RP-2014	mortality	tables	with	a	gender	and	job	classification	specific	increase,	and	applied	an	improvement	scale	with	generational	improvements	that	is generally	based	on	Social	Security	Administration	analysis	and	assumptions.	The	increases	for	fiscal	2018	were	10%	for	white	collar	males,	14%	for	blue collar	males,	11%	for	white	collar	females,	and	10%	for	blue	collar	females.	The	increases	for	fiscal	2017	were	9%	for	white	collar	males,	12%	for	blue collar	males,	11%	for	white	collar	females,	and	9%	for	blue	collar	females.	The	increases	for	fiscal	2016	were	6%	for	white	collar	males,	10%	for	blue	collar males,	12%	for	white	collar	females,	and	19%	for	blue	collar	females.	In	fiscal	2018,	2017	and	2016	our	Canadian	pension	and	postretirement	plans	utilized the	2014	Private	Sector	Canadian	Pensioners	Mortality	Table	adjusted	to	reflect	industry	and	our	mortality	experience	and	applied	Canadian	Pensioner's Mortality	Improvement	Scale	B	with	generational	improvements.

The	estimated	losses	that	will	be	amortized	from	accumulated	other	comprehensive	loss	into	net	periodic	benefit	cost	in	fiscal	2019	are	as	follows	(in millions):

|  | Pension	Plans |  |
| :--- | :--- | :--- |
|  | U.S.\tPlans | Non-U.S.\tPlans |
| Actuarial\tloss | $22.7 | $5.3 |
| Prior\tservice\tcost | 5.2 | 0.1 |
| Total | $27.9 | $5.4 |

Our	projected	estimated	benefit	payments	(unaudited),	which	reflect	expected	future	service,	as	appropriate,	are	as	follows	(in	millions):

|  | Pension	Plans |  |
| :--- | :--- | :--- |
|  | U.S.\tPlans | Non-U.S.\tPlans |
| Fiscal\t2019 | $209.1 | $80.1 |
| Fiscal\t2020 | $218.6 | $80.9 |
| Fiscal\t2021 | $223.0 | $79.8 |
| Fiscal\t2022 | $231.7 | $80.0 |
| Fiscal\t2023 | $218.5 | $80.2 |
| Fiscal\tYears\t2024\t–\t2028 | $1,168.9 | $398.9 |

The	following	table	summarizes	our	pension	plan	assets	measured	at	fair	value	on	a	recurring	basis	(at	least	annually)	as	of	September	30,	2018	(in millions):

|  | Total | in	Active<br>Markets	for<br>Identical<br>Assets	(Level	1) | Significant<br>Other<br>Observable<br>Inputs	(Level	2) |
| :--- | :--- | :--- | :--- |
| Equity\tsecurities: |  |  |  |
| U.S.\tequities\t(1) | $165.5 | $165.5 | $— |
| Non-U.S.\tequities\t(1) | 8.2 | 8.2 | — |
| Fixed\tincome\tsecurities: |  |  |  |
| U.S.\tgovernment\tsecurities\t(2) | 435.8 | — | 435.8 |
| Non-U.S.\tgovernment\tsecurities\t(3) | 127.5 | — | 127.5 |
| U.S.\tcorporate\tbonds\t(3) | 1,493.6 | 108.4 | 1,385.2 |
| Non-U.S.\tcorporate\tbonds\t(3) | 380.8 | 49.3 | 331.5 |
| Other\tfixed\tincome\t(4) | 319.4 | — | 319.4 |
| Short-term\tinvestments\t(5) | 149.0 | 149.0 | — |
| Benefit\tplan\tassets\tmeasured\tin\tthe\tfair\tvalue\thierarchy | $3,079.8 | $480.4 | $2,599.4 |
| Assets\tmeasured\tat\tNAV\t(6) | 2,191.6 |  |  |
| Total\tbenefit\tplan\tassets | $5,271.4 |  |  |

|  | Total | in	Active<br>Markets	for<br>Identical<br>Assets	(Level	1) | Significant<br>Other<br>Observable<br>Inputs	(Level	2) |
| :--- | :--- | :--- | :--- |
| Equity\tsecurities: |  |  |  |
| U.S.\tequities\t(1) | $136.7 | $136.6 | $0.1 |
| Non-U.S.\tequities\t(1) | 40.0 | 40.0 | — |
| Fixed\tincome\tsecurities: |  |  |  |
| U.S.\tgovernment\tsecurities\t(2) | 452.0 | — | 452.0 |
| Non-U.S.\tgovernment\tsecurities\t(3) | 130.0 | — | 130.0 |
| U.S.\tcorporate\tbonds\t(3) | 1,515.4 | 92.3 | 1,423.1 |
| Non-U.S.\tcorporate\tbonds\t(3) | 373.7 | 51.1 | 322.6 |
| Mortgage-backed\tsecurities\t(3) | 0.1 | — | 0.1 |
| Other\tfixed\tincome\t(4) | 311.4 | — | 311.4 |
| Short-term\tinvestments\t(5) | 184.6 | 184.6 | — |
| Benefit\tplan\tassets\tmeasured\tin\tthe\tfair\tvalue\thierarchy | $3,143.9 | $504.6 | $2,639.3 |
| Assets\tmeasured\tat\tNAV\t(6) | 2,378.7 |  |  |
| Total\tbenefit\tplan\tassets | $5,522.6 |  |  |

(1) Equity	securities	are	comprised	of	the	following	investment	types:	(i)	common	stock,	(ii)	preferred	stock	and	(iii)	equity	exchange	traded	funds.	Level	1	investments in	common	and	preferred	stocks	and	exchange	traded	funds	are	valued	using	quoted	market	prices	multiplied	by	the	number	of	shares	owned.

(2) U.S.	government	securities	include	treasury	and	agency	debt.	These	investments	are	valued	using	broker	quotes	in	an	active	market.

(3) The	level	1	non-U.S.	government	securities	investment	is	an	exchange	traded	fund	valued	using	quoted	market	prices.	The	level	1	U.S.	corporate	bonds	category is	primarily	comprised	of	U.S.	dollar	denominated	investment	grade	securities	and	valued	using	quoted	market	prices.	Level	2	investments	are	valued	utilizing	a market	approach	 that	 includes	various	valuation	 techniques	and	sources	such	as	value	generation	models,	broker	quotes	 in	active	and	non-active	markets, benchmark	yields	and	securities,	reported	trades,	issuer	spreads,	and/or	other	applicable	reference	data.

(4) Other	fixed	income	is	comprised	of	municipal	and	asset-backed	securities.	Investments	are	valued	utilizing	a	market	approach	that	includes	various	valuation techniques	and	sources,	such	as	broker	quotes	in	active	and	non-active	markets,	benchmark	yields	and	securities,	reported	trades,	issuer	spreads	and/or	other applicable	reference	data.

(5) Short-term	investments	are	valued	at	$1.00/unit,	which	approximates	fair	value.	Amounts	are	generally	invested	in	interest-bearing	accounts.

(6) Investments	that	are	measured	at	net	asset	value	("NAV")	(or	its	equivalent)	as	a	practical	expedient	have	not	been	classified	in	the	fair	value	hierarchy.

The	following	table	summarizes	assets	measured	at	fair	value	based	on	NAV	per	share	as	a	practical	expedient	as	of	September	30,	2018	and	2017 (in	millions):

|  | Fair	value | Redemption<br>Frequency | Redemption<br>Notice	Period | Unfunded<br>Commitments |
| :--- | :--- | :--- | :--- | :--- |
| September\t30,\t2018 |  |  |  |  |
| Hedge\tfunds\t(1) | $47.9 | Monthly | Up\tto\t30\tdays | $— |
| Commingled\tfunds,\tprivate\tequity,\tprivate\treal\testate |  |  |  |  |
| \t\t\tinvestments,\tand\tequity\trelated\tinvestments \t(2) | 1,092.9 | Monthly | Up\tto\t60\tdays | 75.3 |
| Fixed\tincome\tand\tfixed\tincome\trelated |  |  |  |  |
| \t\t\tinstruments\t(3) | 1,050.8 | Monthly | Up\tto\t10\tdays | — |
|  | $2,191.6 |  |  | $75.3 |
| September\t30,\t2017 |  |  |  |  |
| Hedge\tfunds\t(1) | $64.2 | Quarterly | Up\tto\t91\tdays | $— |
| Commingled\tfunds,\tprivate\tequity,\tprivate\treal\testate |  |  |  |  |
| \t\t\tinvestments,\tand\tequity\trelated\tinvestments \t(2) | 1,207.6 | Monthly | Up\tto\t60\tdays | 98.8 |
| Fixed\tincome\tand\tfixed\tincome\trelated |  |  |  |  |
| \t\t\tinstruments\t(3) | 1,106.9 | Monthly | Up\tto\t10\tdays | — |
|  | $2,378.7 |  |  | $98.8 |

(1) Hedge	fund	investments	are	primarily	made	through	shares	of	limited	partnerships	or	similar	structures.	Hedge	funds	are	typically	valued	monthly	by	third-party administrators	that	have	been	appointed	by	the	funds'	general	partners.	Hedge	funds	have	been	valued	using	NAV	as	a	practical	expedient.

(2) Commingled	fund	investments	are	valued	at	the	net	asset	value	per	share	multiplied	by	the	number	of	shares	held.	The	determination	of	net	asset	value	for	the commingled	funds	includes	market	pricing	of	the	underlying	assets	as	well	as	broker	quotes	and	other	valuation	techniques.	Commingled	funds	have	been	valued using	NAV	as	a	practical	expedient.

(3) Fixed	income	and	fixed	income	related	instruments	consist	of	commingled	debt	funds,	which	are	valued	at	their	net	asset	value	per	share	multiplied	by	the	number of	shares	held.	The	determination	of	net	asset	value	for	the	commingled	funds	includes	market	pricing	of	the	underlying	assets	as	well	as	broker	quotes	and	other valuation	techniques.	Commingled	debt	funds	have	been	valued	using	NAV	as	a	practical	expedient.

We	maintain	holdings	in	certain	private	equity	partnerships	and	private	real	estate	investments	for	which	a	liquid	secondary	market	does	not	exist.	The private	equity	partnerships	are	commingled	investments.	Valuation	techniques,	such	as	discounted	cash	flow	and	market	based	comparable	analyses,	are used	to	determine	fair	value	of	the	private	equity	investments.	Unobservable	inputs	used	for	the	discounted	cash	flow	technique	include	projected	future cash	flows	and	the	discount	rate	used	to	calculate	present	value.	Unobservable	inputs	used	for	the	market-based	comparisons	technique	include	earnings before	 interest,	 taxes,	 depreciation	 and	 amortization	 multiples	 in	 other	 comparable	 third-party	 transactions,	 price	 to	 earnings	 ratios,	 liquidity,	 current operating	results,	as

well	as	input	from	general	partners	and	other	pertinent	information.	Private	equity	investments	have	been	valued	using	NAV	as	a	practical	expedient.

Private	real	estate	investments	are	commingled	investments.	Valuation	techniques,	such	as	discounted	cash	flow	and	market	based	comparable analyses,	are	used	to	determine	fair	value	of	the	private	equity	investments.	Unobservable	inputs	used	for	the	discounted	cash	flow	technique	include projected	future	cash	flows	and	the	discount	rate	used	to	calculate	present	value.	Unobservable	inputs	used	for	the	market-based	comparison	technique include	a	combination	of	third	party	appraisals,	replacement	cost,	and	comparable	market	prices.	Private	real	estate	investments	have	been	valued	using NAV	as	a	practical	expedient.

Equity-related	investments	are	hedged	equity	investments	in	a	commingled	fund	that	consist	primarily	of	equity	indexed	investments	which	are	hedged by	options	and	also	hold	collateral	in	the	form	of	short	term	treasury	securities.	Equity	related	investments	have	been	valued	using	NAV	as	a	practical expedient.

# Postretirement	Plans

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.

|  | U.S.	Plans | Non-U.S.	Plans | U.S.	Plans | Non-U.S.	Plans |
| :--- | :--- | :--- | :--- | :--- |
| Discount\trate | 4.50% | 6.61% | 4.09% | 6.51% |
| Rate\tof\tcompensation\tincrease | N/A | N/A | N/A | 7.37% |

The	following	table	shows	the	changes	in	benefit	obligation	and	plan	assets,	and	the	plan's	funded	status	for	the	fiscal	years	ended	September	30	(in millions):

|  |  | 2018 |  | 2017 |
| :--- | :--- | :--- | :--- | :--- |
| Change\tin\tprojected\tbenefit\tobligation: | U.S.\tPlans | Non-U.S.\tPlans | U.S.\tPlans | Non-U.S.\tPlans |
| Benefit\tobligation\tat\tbeginning\tof\tfiscal\tyear | $98.1 | $68.1 | $90.7 | $62.6 |
| Service\tcost | 0.7 | 0.8 | 0.1 | 0.8 |
| Interest\tcost | 3.9 | 4.0 | 3.3 | 4.1 |
| Amendments | (1.4) | — | (3.4) | (1.0) |
| Actuarial\t(gain)\tloss | (2.5) | (5.2) | 14.1 | 0.4 |
| Benefits\tpaid | (7.8) | (2.6) | (8.0) | (2.7) |
| Business\tcombinations | — | — | 1.3 | 2.0 |
| Business\tdivestitures | — | — | — | (0.4) |
| Curtailments | — | (2.1) | — | (0.3) |
| Foreign\tcurrency\trate\tchanges | — | (7.5) | — | 2.6 |
| Benefit\tobligation\tat\tend\tof\tfiscal\tyear | $91.0 | $55.5 | $98.1 | $68.1 |
| Change\tin\tplan\tassets: |  |  |  |  |
| Fair\tvalue\tof\tplan\tassets\tat\tbeginning\tof\tfiscal\tyear | $— | $— | $— | $— |
| Employer\tcontributions | 7.8 | 2.6 | 8.0 | 2.7 |
| Plan\tparticipant\tcontributions | — | — | — | — |
| Benefits\tpaid | (7.8) | (2.6) | (8.0) | (2.7) |
| Fair\tvalue\tof\tplan\tassets\tat\tend\tof\tfiscal\tyear | $— | $— | $— | $— |
| Funded\tStatus | $(91.0) | $(55.5) | $(98.1) | $(68.1) |
| Amounts\trecognized\tin\tthe\tconsolidated\tbalance\tsheet: |  |  |  |  |
| Other\tcurrent\tliability | $(8.8) | $(2.9) | $(9.8) | $(3.0) |
| Accrued\tpostretirement\tand\tother\tlong-term\tbenefits | (82.2) | (52.6) | (88.3) | (65.1) |
| Under\tfunded\tstatus\tat\tend\tof\tfiscal\tyear | $(91.0) | $(55.5) | $(98.1) | $(68.1) |

The	pre-tax	amounts	in	accumulated	other	comprehensive	loss	at	September	30	not	yet	recognized	as	components	of	net	periodic	postretirement cost,	including	noncontrolling	interest,	consist	of	(in	millions):

|  |  | 2018 |  | 2017 |
| :--- | :--- | :--- | :--- | :--- |
|  | U.S.\tPlans | Non-U.S.\tPlans | U.S.\tPlans | Non-U.S.\tPlans |
| Net\tactuarial\t(gain)\tloss | $(11.2) | $(3.8) | $(9.1) | $4.2 |
| Prior\tservice\tcredit | (11.3) | (1.0) | (13.9) | (1.4) |
| Total\taccumulated\tother\tcomprehensive\t(income)\tloss | $(22.5) | $(4.8) | $(23.0) | $2.8 |

|  |  | Postretirement	Plans |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Net\tactuarial\t(gain)\tloss\tarising\tduring\tperiod | $(9.7) | $14.7 | $(1.4) |
| Amortization\tand\tsettlement\trecognition\tof\tnet\tactuarial\t(loss) |  |  |  |
| \t\t\tgain | (0.3) | 1.3 | 1.9 |
| Prior\tservice\tcredit\tarising\tduring\tperiod | (1.5) | (4.4) | (3.8) |
| Amortization\tor\tcurtailment\trecognition\tof\tprior\tservice\tcredit | 4.4 | 4.5 | 2.1 |
| Net\tother\tcomprehensive\t(income)\tloss\trecognized | $(7.1) | $16.1 | $(1.2) |

The	net	periodic	postretirement	cost	recognized	in	the	consolidated	statements	of	operations	is	comprised	of	the	following	for	fiscal	years	ended	(in millions):

|  |  | Postretirement	Plans |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Service\tcost | $1.5 | $0.9 | $2.3 |
| Interest\tcost | 7.9 | 7.4 | 8.1 |
| Amortization\tof\tnet\tactuarial\tloss\t(gain) | 0.3 | (1.3) | (2.0) |
| Amortization\tof\tprior\tservice\tcredit | (4.4) | (4.5) | (2.1) |
| Curtailment\tgain | (0.1) | (0.3) | — |
| Net\tpostretirement\tcost | $5.2 | $2.2 | $6.3 |

As	of	September	30,	2018,	the	effect	of	a	1%	change	in	the	assumed	health	care	cost	trend	rate	would	increase	the	APBO	by	approximately	$7	million or	decrease	the	APBO	by	approximately	$6	million,	and	would	increase	the	annual	net	periodic	postretirement	benefit	cost	for	fiscal	2018	by	$0	million	or decrease	the	annual	net	periodic	postretirement	benefit	cost	for	fiscal	2018	by	approximately	$1	million.

|  | 2018 |  | Postretirement	Plans<br>2017 |  | 2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | U.S.\nPlans | Non-U.S.\nPlans | U.S.\nPlans | Non-U.S.\nPlans | U.S.\nPlans | Non-U.S.\nPlans |
| Discount\trate | 4.09% | 6.51% | 4.04% | 6.64% | 4.70% | 6.84% |
| Rate\tof\tcompensation\tincrease | N/A | 7.37% | N/A | 3.14% | N/A | 3.10% |

The	estimated	gains	that	will	be	amortized	from	accumulated	other	comprehensive	loss	into	net	periodic	benefit	cost	in	fiscal	2019	are	as	follows	(in millions):

|  | Postretirement	Plans | Postretirement	Plans |
| :--- | :--- | :--- |
|  | U.S.\tPlans | Non-U.S.\tPlans |
| Actuarial\tgain | $(1.1) | $(0.4) |
| Prior\tservice\tcredit | (2.6) | (0.2) |
| Total | $(3.7) | $(0.6) |

|  | Postretirement	Plans | Postretirement	Plans |
| :--- | :--- | :--- |
|  | U.S.\tPlans | Non-U.S.\tPlans |
| Fiscal\t2019 | $9.3 | $2.9 |
| Fiscal\t2020 | $8.2 | $3.0 |
| Fiscal\t2021 | $7.8 | $3.1 |
| Fiscal\t2022 | $7.4 | $3.2 |
| Fiscal\t2023 | $7.1 | $3.3 |
| Fiscal\tYears\t2024\t–\t2028 | $31.4 | $19.1 |

# Multiemployer	Plans

We	 participate	 in	 several	 MEPPs	 that	 provide	 retirement	 benefits	 to	 certain	 union	 employees	 in	 accordance	 with	 various	 CBAs.	 The risks	 of participating	in	MEPPs	are	different	from	the	risks	of	participating	in	single-employer	pension	plans.	These	risks	include:

•assets	contributed	to	a	MEPP	by	one	employer	are	used	to	provide	benefits	to	employees	of	all	participating	employers,

•if	a	participating	employer	withdraws	from	a	MEPP,	the	unfunded	obligations	of	the	MEPP	allocable	to	such	withdrawing	employer	may	be	borne by	the	remaining	participating	employers,	and

•if	we	withdraw	from	a	MEPP,	we	may	be	required	to	pay	that	plan	an	amount	based	on	our	allocable	share	of	the	unfunded	vested	benefits	of	the plan,	referred	to	as	a	withdrawal	liability,	as	well	as	a	share	of	the	MEPP's	accumulated	funding	deficiency.

Our	contributions	to	a	particular	MEPP	are	established	by	the	applicable	CBAs;	however,	our	required	contributions	may	increase	based	on	the	funded status	of	a	MEPP	and	legal	requirements,	such	as	those	set	forth	in	the	Pension	Act,	which	requires	substantially	underfunded	MEPPs	to	implement	a	FIP or	a	RP	to	improve	their	funded	status.	Factors	that	could	impact	the	funded	status	of	a	MEPP	include,	without	limitation,	investment	performance,	changes in	participant	demographics,	decline	in	the	number	of	contributing	employers,	changes	in	actuarial	assumptions	and	the	utilization	of	extended	amortization provisions.	We	believe	that	certain	of	the	MEPPs	in	which	we	participate	or	have	participated,	including	the	PIUMPF,	have	material	unfunded	vested benefits.	The	Pension	Act	established	three	categories,	or	"zones",	for	the	funded	status	of	plans.	Among	other	factors,	plans	in	the	green	zone	are	at	least 80%	funded	and	are	designated	as	healthy,	plans	in	the	yellow	zone	are	greater	than	65%	but	less	than	80%	funded	and	are	designated	as	endangered and	plans	in	the	red	zone	are	generally	less	than	65%	funded	and	are	designated	as	critical	or	critical	and	declining.	Each	plan's	actuary	must	certify	the plan	status	annually.	Several	of	the	MEPPs	in	which	we	participate	or	have	participated,	including	PIUMPF,	have	been	certified	in	the	red	zone	for	critical and	declining.	Our	share	of	the	contributions	in	PIUMPF	have	exceeded	5%	of	total	plan	contributions	in	recent	plan	years.

A	FIP	or	RP	requires	a	particular	MEPP	to	adopt	measures	to	correct	its	underfunded	status.	These	measures	may	include,	but	are	not	limited	to,	an increase	in	our	contribution	rate	from	that	provided	in	the	applicable	CBA,	a	reallocation	of	the	contributions	already	being	made	by	participating	employers for	various	benefits	to	individuals	participating	in	the	MEPP,	and/or	a	reduction	in	the	benefits	to	be	paid	to	future	and/or	current	retirees.	In	addition,	the Pension	Act	requires	that	a	5%	surcharge	be	levied	on	employer	contributions	for	the	first	year	commencing	shortly	after	the	date	the	employer	receives notice	that	the	MEPP	is	certified	in	the	red	zone	and	a	10%	surcharge	on	each	succeeding	year	until	a	CBA	is	in	place	with	terms	and	conditions	consistent with	the	RP.	On	January	1,	2016,	the	surcharge	we	paid	for	PIUMPF	increased	from	10%	to	15%.

In	the	normal	course	of	business,	we	evaluate	our	potential	exposure	to	MEPPs,	including	with	respect	to	potential	withdrawal	liabilities.	During	fiscal 2018,	we	submitted	formal	notification	to	withdraw	from	PIUMPF	and	recorded	an	estimated	withdrawal	liability	of	$180.0	million.	The	estimated	withdrawal liability	assumes	payment	over	20	years,	discounted	at	a	credit	adjusted	risk-free	rate	of	3.83%.	We	expect	PIUMPF's	demand	related	to	the	withdrawal	to include	both	a	payment	 for	withdrawal	 liability	and	 for	our	proportionate	share	of	PIUMPF's	accumulated	 funding	deficiency.	We	reserve	 the	right	 to challenge	any	portion	of	the	demand,	including	any	portion	related	to	the	accumulated	funding	deficiency.	The	estimated	withdrawal	liability	noted	above excludes	the	potential	impact	of	a	future	mass	withdrawal	of	other	employers	from	PIUMPF,	which	is	not	considered	probable	or	reasonably	estimable	at this	time.	Due	to	the	absence	of	specific	information	regarding	matters	such	as	PIUMPF's	current	financial	situation,	our	estimate	is	subject	to	revision.	In addition,	in	fiscal	2018,	we	submitted	formal	notification	to	withdraw	from	Central	States	and	recorded	an	estimated	withdrawal	liability	of	$4.2	million	on	a discounted	basis.	It	is	reasonably	possible	that	we	may	incur	withdrawal	liabilities	with	respect	to	certain	other	MEPPs	in	connection	with	such	withdrawals. Our	estimate	of	any	such	withdrawal	liability,	both	individually	and	in	the	aggregate,	is	not	material	for	the	remaining	plans	in	which	we	participate.

At	September	30,	2018	and	September	30,	2017,	we	had	withdrawal	liabilities	recorded	of	$247.8	million	and	$60.1	million,	respectively.	In	addition	to the	contributions	presented	in	the	table	below,	for	fiscal	2018,	2017	and	2016	we	accrued	$6.0	million,	$1.9	million	and	$2.1	million,	respectively,	related	to withdrawal	 liabilities.	The	 impact	of	 future	withdrawal	 liabilities,	 future	 funding	obligations	or	 increased	contributions	may	be	material	 to	our	results	of operations,	cash	flows	and	financial	condition	and	the	trading	price	of	our	Common	Stock.

Approximately	43%	of	our	employees	are	covered	by	CBAs	or	similar	agreements,	of	which	approximately	8%	are	covered	by	CBAs	or	similar agreements	that	have	expired	and	another	6%	are	covered	by	CBAs	or	similar	agreements	that	expire	within	one	year.

The	following	table	lists	our	participation	in	our	multiemployer	and	other	plans	that	are	individually	significant	for	the	years	ended	September	30	(in millions):

| Pension	Fund | EIN	/	Pension<br>Plan	Number | Pension	Act<br>Zone	Status<br>2018 | 2017 | FIP	/	RP<br>Status<br>Pending	/<br>Implemented | 2018 | Contributions	(1)<br>2017 | 2016 | Surcharge<br>imposed? |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| U.S.\tMultiemployer\tplans: |  |  |  |  |  |  |  |  |
| Pace\tIndustry\tUnion-\tManagement | 11-6166763\t/ |  |  |  |  |  |  |  |
| \t\t\tPension\tFund\t(2) | 001 | Red | Red | Implemented | $0.9 | $3.5 | $3.3 | Yes |
| Other\tFunds\t(3) |  |  |  |  | 0.5 | 1.6 | 1.2 |  |
| Total\tContributions: |  |  |  |  | $1.4 | $5.1 | $4.5 |  |

(1) Contributions	represent	the	amounts	contributed	to	the	plan	during	the	fiscal	year.

(2) Our	contributions	for	fiscal	2017	and	2016	exceeded	5%	of	total	plan	contributions.	Although	the	plan	data	for	fiscal	2018	is	not	yet	available,	we	do	not	expect	to continue	to	exceed	5%	of	total	plan	contributions	due	to	our	submission	of	notification	to	withdraw	from	PIUMPF.

(3) Two	additional	MEPPs	in	which	we	participate	have	been	certified	as	critical	and	declining.

# Defined	Contribution	Plans

We	have	401(k)	and	other	defined	contribution	plans	that	cover	certain	of	our	U.S.,	Canadian	and	other	non-U.S.	salaried	union	and	nonunion	hourly employees,	generally	subject	to	an	initial	waiting	period.	The	401(k)	and	other	defined	contribution	plans	permit	participants	to	make	contributions	by	salary reduction	pursuant	to	Section	401(k)	of	the	Code	or	the	taxing	authority	in	the	jurisdiction	in	which	they	operate.	Due	primarily	to	acquisitions,	CBAs	and other	non-U.S.	defined	contribution	programs,	we	have	plans	with	varied	terms.	At	September	30,	2018,	our	contributions	may	be	up	to	7.5%	for	U.S. salaried	and	non-union	hourly	employees,	consisting	of	a	match	of	up	to	5%	and	an	automatic	employer	contribution	of	2.5%.	Certain	other	employees	who receive	accruals	under	a	defined	benefit	pension	plan,	certain	employees	covered	by	CBAs	and	non-U.S.	defined	contribution	programs	receive	generally up	to	a	3.0%	to	4.0%	contribution	to	their	401(k)	plan	or	defined	contribution	plan.	During	fiscal	2018,	2017	and	2016,	we	recorded	expense	of	$113.7 million,	$104.1	million	and	$86.5	million,	respectively,	related	to	matching	contributions	to	the	401(k)	plans	and	other	defined	contribution	plans,	including	the automatic	employer	contribution.

# Supplemental	Retirement	Plans

We	have	Supplemental	Plans	that	are	nonqualified	deferred	compensation	plans.	We	intend	to	provide	participants	with	an	opportunity	to	supplement their	 retirement	 income	 through	 deferral	 of	 current	 compensation.	Amounts	 deferred	 and	 payable	 under	 the	 Supplemental	 Plans	 are	 our	 unsecured obligations	and	rank	equally	with	our	other	unsecured	and	unsubordinated	indebtedness	outstanding.	Participants'	accounts	are	credited	with	investment gains	and	losses	under	the	Supplemental	Plans	in	accordance	with	the	participant's	investment	election	or	elections	(or	default	election	or	elections)	as	in effect	from	time	to	time.	At	September	30,	2018,	the	Supplemental	Plans	had	assets	totaling	$174.2	million	that	are	recorded	at	market	value,	and	liabilities of	$178.1	million.	The	investment	alternatives	available	under	the	Supplemental	Plans	are	generally	similar	to	investment	alternatives	available	under	401(k) plans.	The	amount	of	expense	we	recorded	for	the	current	fiscal	year	and	the	preceding	two	fiscal	years	was	not	significant.

# Note	5. Income	Taxes

The	components	of	income	(loss)	from	continuing	operations	before	income	taxes	are	as	follows	(in	millions):

|  |  | Year	Ended	September	30, |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| United\tStates | $736.7 | $481.9 | $(25.1) |
| Foreign | 298.1 | 375.7 | 269.7 |
| Income\tfrom\tcontinuing\toperations\tbefore\tincome\ttaxes | $1,034.8 | $857.6 | $244.6 |

The	loss	from	continuing	operations	in	the	U.S.	in	fiscal	2016	was	primarily	the	result	of	the	pension	risk	transfer	expense	and	restructuring	charges.

# See	"Note	4.	Retirement	Plans"	and	"Note	3.	Restructuring	and	Other	Costs".

# Impacts	of	the	Tax	Act

On	December	22,	2017,	the	Tax	Act	was	signed	into	law.	The	Tax	Act	contains	significant	changes	to	corporate	taxation,	including	(i)	the	reduction	of the	corporate	income	tax	rate	to	21%,	(ii)	the	acceleration	of	expensing	for	certain	business	assets,	(iii)	the	one-time	transition	tax	related	to	the	transition	of U.S.	international	tax	from	a	worldwide	tax	system	to	a	territorial	tax	system,	(iv)	the	repeal	of	the	domestic	production	deduction,	(v)	additional	limitations on	the	deductibility	of	interest	expense	and	(vi)	expanded	limitations	on	executive	compensation.

U.S.	Securities	and	Exchange	Commission	Staff	Accounting	Bulletin	(" SAB")	No.	118	was	issued	to	address	the	application	of	GAAP	in	situations when	a	registrant	does	not	have	the	necessary	information	available,	prepared,	or	analyzed	in	reasonable	detail	to	finalize	the	calculations	for	certain income	tax	effects	of	the	Tax	Act.	Under	SAB	118,	we	have	made	reasonable	estimates	and	recorded	provisional	amounts	as	described	below.

The	key	impacts	of	the	Tax	Act	on	our	financial	statements	for	fiscal	2018	were	the	remeasurement	of	deferred	tax	balances	to	the	new	corporate	tax rate	and	the	accrual	for	the	one-time	transition	tax	liability.	We	recorded	provisional	amounts	of	the	effects	of	the	Tax	Act.

In	order	to	calculate	the	effects	of	the	new	corporate	tax	rate	on	our	deferred	tax	balances,	ASC	740,	" Income	Taxes"	required	the	remeasurement	of our	deferred	tax	balances	as	of	the	enactment	date	of	the	Tax	Act,	based	on	the	rates	at	which	the	balances	were	expected	to	reverse	in	the	future.	The remeasurement	of	our	deferred	tax	balances	resulted	in	a	provisional	net	reduction	in	deferred	liabilities	of	$1,215.9	million	in	fiscal	2018.

Additionally,	in	fiscal	2018,	we	made	a	reasonable	estimate	for	the	amount	of	the	one-time	transition	tax.	The	one-time	transition	tax	is	based	on	our total	post-1986	foreign	earnings	and	profits	that	were	previously	deferred	from	U.S.	income	tax.	The	applicable	tax	rate	is	based	on	the	amount	of	those post-1986	earnings	that	is	held	in	cash	and	other	specified	assets.	We	recorded	a	provisional	one-time	transition	tax	liability	of	$95.4	million	or	$87.1	million net	of	the	release	of	a	previously	recorded	outside	basis	difference.

To	date,	we	have	been	unable	to	determine	a	reasonable	estimate	of	the	tax	liability,	if	any,	under	the	Tax	Act	for	our	remaining	outside	basis difference	or	evaluate	how	the	Tax	Act	will	affect	our	existing	accounting	position	to

indefinitely	reinvest	unremitted	foreign	earnings.	We	will	continue	to	apply	our	existing	accounting	under	ASC	740	for	this	matter	and	finalize	it	in	fiscal	2019.

Our	accounting	for	the	income	tax	effects	of	the	Tax	Act	will	be	completed	during	the	measurement	period	allowed	under	SAB	118.	We	will	record	any necessary	adjustments	in	the	period	such	adjustments	are	identified.		The	final	determination	of	the	Tax	Act	will	be	made	based	on	a	variety	of	factors, among	 others,	 (i)	 further	 guidance	 from	 the	 U.S.	 Department	 of	 Treasury	 and	 from	 Securities	 Commission	 or	 FASB	 related	 to	 the	 Tax	 Act,	 (ii) management's	 further	assessment	of	 the	Tax	Act	and	related	regulatory	guidance,	and	(iii)	and	changes	 to	estimates	made	 to	calculate	our	existing temporary	differences.

As	part	of	the	enacted	Tax	Act,	Global	Intangible	Low	Taxed	Income	(" GILTI")	provisions	were	introduced	that	would	impose	a	tax	on	foreign	income	in excess	of	a	deemed	return	on	tangible	assets	of	foreign	corporations.	Guidance	released	by	the	FASB	indicates	that	either	accounting	for	deferred	taxes related	 to	 GILTI	 inclusions	 or	 treating	 any	 taxes	 on	 GILTI	 inclusions	 as	 period	 costs	 are	 both	 acceptable	 methods	 subject	 to	 an	 accounting	 policy election.	The	GILTI	provisions	will	not	take	effect	for	WestRock	until	the	fiscal	year	ending	September	30,	2019,	and	the	Company	has	provisionally	elected to	treat	any	potential	GILTI	inclusions	as	a	period	cost	during	the	year	incurred.

Income	tax	expense	(benefit)	from	continuing	operations	consists	of	the	following	components	(in	millions):

|  | 2018 | Year	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Current\tincome\ttaxes: |  |  |  |
| Federal | $83.0 | $80.8 | $98.3 |
| State | 26.8 | 3.3 | 12.8 |
| Foreign | 86.6 | 95.3 | 87.0 |
| Total\tcurrent\texpense | 196.4 | 179.4 | 198.1 |
| Deferred\tincome\ttaxes: |  |  |  |
| Federal | (1,108.6) | 15.2 | (131.5) |
| State | 53.2 | (22.8) | 6.9 |
| Foreign | (15.5) | (12.8) | 16.3 |
| Total\tdeferred\t(benefit)\texpense | (1,070.9) | (20.4) | (108.3) |
| Total\tincome\ttax\t(benefit)\texpense | $(874.5) | $159.0 | $89.8 |

The	differences	between	the	statutory	federal	income	tax	rate	and	our	effective	income	tax	rate	from	continuing	operations	are	as	follows:

|  |  | Year	Ended	September	30, |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Statutory\tfederal\ttax\trate | 24.5% | 35.0% | 35.0% |
| Foreign\trate\tdifferential | 0.6 | (4.9) | (5.5) |
| Adjustment\tand\tresolution\tof\tfederal,\tstate\tand\tforeign\ttax |  |  |  |
| \t\t\tuncertainties | 0.9 | (0.3) | 0.2 |
| State\ttaxes,\tnet\tof\tfederal\tbenefit | 4.3 | 3.3 | 4.9 |
| Tax\tAct\t(1) | (109.1) | — | — |
| Excess\ttax\tbenefit\trelated\tto\tstock\tcompensation | (0.8) | — | — |
| Research\tand\tdevelopment\tand\tother\ttax\tcredits,\tnet\tof\tvaluation |  |  |  |
| \t\t\tallowances\tand\treserves | (0.5) | (0.8) | (6.1) |
| Income\tattributable\tto\tnoncontrolling\tinterest | (0.1) | 0.4 | 0.8 |
| Domestic\tmanufacturer's\tdeduction | (1.8) | (2.0) | (4.4) |
| Sale\tof\tHH&amp;B | — | (5.0) | — |
| U.S.\tlegal\tentity\trestructuring | — | (3.3) | — |
| Change\tin\tvaluation\tallowance | (1.8) | (3.3) | 6.3 |
| Nondeductible\ttransaction\tcosts | — | 1.0 | 0.4 |
| Contribution\tof\tassets\tto\tGrupo\tGondi\tjoint\tventure | — | — | 3.4 |
| Nontaxable\tincreased\tcash\tsurrender\tvalue | (0.8) | (1.5) | (4.6) |
| Withholding\ttaxes | 0.5 | 0.4 | 2.0 |
| Brazilian\tnet\tworth\tdeduction | (0.9) | (0.8) | (2.0) |
| Other,\tnet | 0.5 | 0.3 | 6.3 |
| Effective\ttax\trate | (84.5)% | 18.5% | 36.7% |

(1) The	primary	components	are	a	$1,215.9	million	benefit	from	the	remeasurement	of	our	net	U.S.	deferred	tax	liability	and	a	one-time	transition	tax	liability	of	$95.4 million	or	$87.1	million	net	of	the	release	of	a	previously	recorded	outside	basis	difference.

The	tax	effects	of	temporary	differences	that	give	rise	to	deferred	income	tax	assets	and	liabilities	consist	of	the	following	(in	millions):

|  | September	30,<br>2018 | 2017 |
| :--- | :--- | :--- |
| Deferred\tincome\ttax\tassets: |  |  |
| Accruals\tand\tallowances | $22.1 | $40.6 |
| Employee\trelated\taccruals\tand\tallowances | 213.2 | 265.1 |
| State\tnet\toperating\tloss\tcarryforwards | 78.4 | 70.6 |
| State\tcredit\tcarryforwards,\tnet\tof\tfederal\tbenefit | 64.8 | 54.4 |
| U.S.\tand\tforeign\ttax\tcredit\tcarryforwards | 14.7 | 135.9 |
| Federal\tand\tforeign\tnet\toperating\tloss\tcarryforwards | 188.7 | 204.1 |
| Restricted\tstock\tand\toptions | 46.7 | 81.0 |
| Other | 45.3 | 32.8 |
| Total | 673.9 | 884.5 |
| Deferred\tincome\ttax\tliabilities: |  |  |
| Property,\tplant\tand\tequipment | 1,509.7 | 2,154.1 |
| Deductible\tintangibles\tand\tgoodwill | 698.1 | 1,091.4 |
| Inventory\treserves | 168.6 | 236.1 |
| Deferred\tgain | 258.8 | 405.2 |
| Pension\tobligations | 60.1 | 90.8 |
| Basis\tdifference\tin\tjoint\tventures | 35.5 | 57.1 |
| Other | — | 8.3 |
| Total | 2,730.8 | 4,043.0 |
| Valuation\tallowances | 229.4 | 219.1 |
| Net\tdeferred\tincome\ttax\tliability | $2,286.3 | $3,377.6 |

Deferred	taxes	are	recorded	as	follows	in	the	consolidated	balance	sheet	(in	millions):

|  | September	30, |  |
| :--- | :--- | :--- |
|  | 2018 | 2017 |
| Long-term\tdeferred\ttax\tasset\t(1) | $35.2 | $32.6 |
| Long-term\tdeferred\ttax\tliability | 2,321.5 | 3,410.2 |
| Net\tdeferred\tincome\ttax\tliability | $2,286.3 | $3,377.6 |

(1) The	long-term	deferred	tax	asset	is	presented	in	Other	assets	on	the	consolidated	balance	sheets.

At	September	30,	2018	and	September	30,	2017,	we	had	alternative	minimum	tax	credits	of	$14.7	million	and	$132.2	million,	respectively.	Under current	tax	law,	the	alternative	minimum	tax	credit	carryforwards	become	refundable	tax	credits	in	future	years.	We	had	no	research	and	development	tax credits	and	general	business	credits	outstanding,	respectively,	at	September	30,	2018.

At	September	30,	2018	and	September	30,	2017,	we	had	gross	state	and	local	net	operating	losses,	of	approximately	$1,676	million	and	$1,885 million,	respectively.	These	loss	carryforwards	generally	expire	between	fiscal	2020	and	2038.	The	tax	effected	values	of	these	net	operating	losses	are $78.4	million	and	$70.6	million	at	September	30,	2018	and	2017,	respectively,	exclusive	of	valuation	allowances	of	$7.8	million	and	$15.9	million	at September	30,	2018	and	2017,	respectively.

At	September	30,	2018	and	September	30,	2017,	gross	net	operating	losses	for	foreign	reporting	purposes	of	approximately	$698.4	million	and $	673.7	million,	respectively,	were	available	for	carryforward.	A	majority	of	these	loss	carryforwards	generally	expire	between	fiscal	2020	and	2038,	while	a portion	have	an	indefinite	carryforward.	The	tax	effected	values	of	these	net	operating	losses	are	$185.8	million	and	$182.6	million	at	September	30,	2018 and	2017,	respectively,	exclusive	of	valuation	allowances	of	$161.5	million	and	$149.6	million	at	September	30,	2018	and	2017,	respectively.

At	September	30,	2018	and	2017,	we	had	state	 tax	credit	carryforwards	of	$64.8	million	and	$54.4	million,	respectively.	These	state	 tax	credit carryforwards	generally	expire	within	5	to	10	years;	however,	certain	state	credits	can	be	carried	forward	indefinitely.	Valuation	allowances	of	$56.1	million and	$47.3	million	at	September	30,	2018	and	2017,	respectively,	have	been	provided	on	these	assets.	These	valuation	allowances	have	been	recorded	due to	uncertainty	regarding	our	ability	to	generate	sufficient	taxable	income	in	the	appropriate	taxing	jurisdiction.

The	following	table	represents	a	summary	of	the	valuation	allowances	against	deferred	tax	assets	for	fiscal	2018,	2017	and	2016	(in	millions):

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Balance\tat\tbeginning\tof\tfiscal\tyear | $219.1 | $177.2 | $100.2 |
| Increases | 50.8 | 54.3 | 24.8 |
| Allowances\trelated\tto\tpurchase\taccounting \t(1) | 0.1 | 12.4 | 63.0 |
| Reductions | (40.6) | (24.8) | (10.8) |
| Balance\tat\tend\tof\tfiscal\tyear | $229.4 | $219.1 | $177.2 |

(1) Amounts	in	fiscal	2018	and	2017	relate	to	the	MPS	Acquisition.	Adjustments	in	fiscal	2016	relate	to	the	Combination	and	the	SP	Fiber	Acquisition.

Consistent	with	prior	years,	we	consider	a	portion	of	our	earnings	from	certain	foreign	subsidiaries	as	subject	to	repatriation	and	we	provide	for	taxes accordingly.	However,	we	consider	the	unremitted	earnings	and	all	other	outside	basis	differences	from	all	other	foreign	subsidiaries	to	be	indefinitely reinvested.	Accordingly,	we	have	not	provided	for	any	taxes	that	would	be	due.

As	 of	 September	 30,	 2018,	 we	 estimate	 our	 outside	 basis	 difference	 in	 foreign	 subsidiaries	 that	 are	 considered	 indefinitely	 reinvested	 to	 be approximately	$1.5	billion.	The	components	of	the	outside	basis	difference	are	comprised	of	purchase	accounting	adjustments,	undistributed	earnings,	and equity	components.	Except	for	the	portion	of	our	earnings	from	certain	foreign	subsidiaries	where	we	provided	for	taxes,	we	have	not	provided	for	any	taxes that	would	be	due	upon	the	reversal	of	the	outside	basis	differences.	However,	in	the	event	of	a	distribution	in	the	form	of	dividends	or	dispositions	of	the subsidiaries,	we	may	be	subject	to	incremental	U.S.	income	taxes,	subject	to	an	adjustment	for	foreign	tax	credits,	and	withholding	taxes	or	income	taxes payable	 to	 the	 foreign	 jurisdictions.	As	of	September	30,	2018,	 the	determination	of	 the	amount	of	unrecognized	deferred	 tax	 liability	related	 to	any remaining	undistributed	foreign	earnings	not	subject	to	the	Transition	Tax	and	additional	outside	basis	differences	is	not	practicable.

A	reconciliation	of	the	beginning	and	ending	amount	of	gross	unrecognized	tax	benefits	is	as	follows	(in	millions):

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Balance\tat\tbeginning\tof\tfiscal\tyear | $148.9 | $166.8 | $106.6 |
| Additions\trelated\tto\tpurchase\taccounting\t(1) | 3.4 | 7.7 | 16.5 |
| Additions\tfor\ttax\tpositions\ttaken\tin\tcurrent\tyear | 3.1 | 5.0 | 30.3 |
| Additions\tfor\ttax\tpositions\ttaken\tin\tprior\tfiscal\tyears | 18.0 | 15.2 | 20.6 |
| Reductions\tfor\ttax\tpositions\ttaken\tin\tprior\tfiscal\tyears | (5.3) | (25.6) | (9.7) |
| Reductions\tdue\tto\tsettlement\t (2) | (29.4) | (14.1) | (1.3) |
| (Reductions)\tadditions\tfor\tcurrency\ttranslation\tadjustments | (9.6) | 2.0 | 7.0 |
| Reductions\tas\ta\tresult\tof\ta\tlapse\tof\tthe\tapplicable\tstatute\tof |  |  |  |
| \t\t\tlimitations | (2.0) | (8.1) | (3.2) |
| Balance\tat\tend\tof\tfiscal\tyear | $127.1 | $148.9 | $166.8 |

(2) Amounts	in	fiscal	2018	relate	to	the	settlement	of	state	audit	examinations	and	federal	and	state	amended	returns	filed	related	to	affirmative	adjustments	for	which a	there	was	a	reserve.	Amounts	in	fiscal	2017	relate	to	the	settlement	of	federal	and	state	audit	examinations	with	taxing	authorities.

As	of	September	30,	2018	and	2017,	the	total	amount	of	unrecognized	tax	benefits	was	approximately	$127.1	million	and	$148.9	million,	respectively, exclusive	of	interest	and	penalties.	Of	these	balances,	as	of	September	30,	2018	and	2017,	if	we	were	to	prevail	on	all	unrecognized	tax	benefits	recorded, approximately	$108.7	million	and	$138.0	million,	respectively,	would	benefit	the	effective	tax	rate.	We	regularly	evaluate,	assess	and	adjust	the	related liabilities	in	light	of	changing	facts	and	circumstances,	which	could	cause	the	effective	tax	rate	to	fluctuate	from	period	to	period.

We	 recognize	 estimated	 interest	 and	 penalties	 related	 to	 unrecognized	 tax	 benefits	 in	 income	 tax	 expense	 in	 the	 consolidated	 statements	 of operations.	As	of	September	30,	2018,	we	had	liabilities	of	$70.4	million	related	to	estimated	interest	and	penalties	for	unrecognized	tax	benefits.	As	of September	30,	2017,	we	had	liabilities	of	$81.7	million,	net	of	indirect	benefits,	related	to	estimated	interest	and	penalties	for	unrecognized	tax	benefits.	Our results	 of	 operations	 for	 the	 fiscal	 year	 ended	 September	 30,	 2018,	 2017	 and	 2016	 include	 expense	 of	 $5.8	 million,	 $7.4	 million	 and	 $2.9	 million, respectively,	 net	 of	 indirect	 benefits,	 related	 to	 estimated	 interest	 and	 penalties	 with	 respect	 to	 the	 liability	 for	 unrecognized	 tax	 benefits.	 As	 of September	30,	2018,	it	is	reasonably	possible	that	our	unrecognized	tax	benefits	will	decrease	by	up	to	$5.5	million	in	the	next	twelve	months	due	to expiration	of	various	statues	of	limitations	and	settlement	of	issues.

We	file	federal,	state	and	local	income	tax	returns	in	the	U.S.	and	various	foreign	jurisdictions.	With	few	exceptions,	we	are	no	longer	subject	to	U.S. federal	and	state	and	local	income	tax	examinations	by	tax	authorities	for	years	prior	to	fiscal	2015	and	fiscal	2008,	respectively.	We	are	no	longer	subject	to non-U.S.	income	tax	examinations	by	tax	authorities	for	years	prior	to	fiscal	2011,	except	for	Brazil	for	which	we	are	not	subject	to	tax	examinations	for years	prior	to	2005.	While	we	believe	our	tax	positions	are	appropriate,	they	are	subject	to	audit	or	other	modifications	and	there	can	be	no	assurance	that any	modifications	will	not	materially	and	adversely	affect	our	results	of	operations,	financial	condition	or	cash	flows.

# Note	6. Segment	Information

We	report	our	financial	results	of	operations	in	the	following	three	reportable	segments:	Corrugated	Packaging,	which	consists	of	our	containerboard mill	and	corrugated	packaging	operations,	as	well	as	our	recycling	operations;	Consumer	Packaging,	which	consists	of	consumer	mills,	folding	carton, beverage,	merchandising	displays	and	partition	operations;	and	Land	and	Development,	which	sells	real	estate	primarily	in	the	Charleston,	SC	region. Following	 the	 Combination	 and	 until	 the	 completion	 of	 the	 Separation,	 our	 financial	 results	 of	 operations	 had	 a	 fourth	 reportable	 segment,	 Specialty Chemicals.	Prior	to	the	HH&B	Sale,	our	Consumer	Packaging	segment	included	HH&B.	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.

Some	of	our	operations	included	in	the	segments	are	located	in	locations	such	as	Canada,	Mexico,	South	America,	Europe,	Asia	and	Australia.	The table	below	reflects	financial	data	of	our	foreign	operations	for	each	of	the	past	three	fiscal	years,	some	of	which	were	transacted	in	U.S.	dollars	(in	millions, except	percentages):

|  | Years	Ended	September	30, | Years	Ended	September	30, |  |
| :--- | :--- | :--- | :--- |
|  | 2018 | 2017 | 2016 |
| Foreign\tnet\tsales\tto\tunaffiliated\tcustomers | $3,236.7 | $2,621.2 | $2,426.6 |
| Foreign\tsegment\tincome | $360.7 | $260.1 | $226.1 |
| Foreign\tlong-lived\tassets | $1,400.2 | $1,558.3 | $1,341.5 |
| Foreign\toperations\tas\ta\tpercent\tof\tconsolidated\toperations: |  |  |  |
| Foreign\tnet\tsales\tto\tunaffiliated\tcustomers | 19.9% | 17.6% | 17.1% |
| Foreign\tsegment\tincome | 21.4% | 21.8% | 18.4% |
| Foreign\tlong-lived\tassets | 15.4% | 17.1% | 14.4% |

We	 evaluate	 performance	 and	 allocate	 resources	 based,	 in	 part,	 on	 profit	 from	 operations	 before	 income	 taxes,	 interest	 and	 other	 items.	 The accounting	policies	of	the	reportable	segments	are	the	same	as	those	described	in	"Note	1.	Description	of	Business	and	Summary	of	Significant Accounting	Policies".	We	account	for	intersegment	sales	at	prices	that	approximate	market	prices.	For	segment	reporting	purposes,	we	include	our	equity in	income	of	unconsolidated	entities	in	segment	income,	as	well	as	our	investments	in	unconsolidated	entities	in	segment	identifiable	assets.	Equity	in income	of	unconsolidated	entities	is	not	material	and	we	disclose	our	investments	in	unconsolidated	entities	below.	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):

|  | 2018 | Years	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales\t(aggregate): |  |  |  |
| Corrugated\tPackaging | $9,103.4 | \t$8,408.3 | \t$7,868.5 |
| Consumer\tPackaging | 7,291.4 | 6,452.5 | 6,388.1 |
| Land\tand\tDevelopment | 142.4 | 243.8 | 119.8 |
| Total | $16,537.2 | \t$15,104.6 | \t$14,376.4 |
| Less\tnet\tsales\t(intersegment): |  |  |  |
| Corrugated\tPackaging | $161.6 | \t$155.8 | \t$136.2 |
| Consumer\tPackaging | 90.5 | 89.1 | 68.4 |
| Total | $252.1 | \t$244.9 | \t$204.6 |
| Net\tsales\t(unaffiliated\tcustomers): |  |  |  |
| Corrugated\tPackaging | $8,941.8 | \t$8,252.5 | \t$7,732.3 |
| Consumer\tPackaging | 7,200.9 | 6,363.4 | 6,319.7 |
| Land\tand\tDevelopment | 142.4 | 243.8 | 119.8 |
| Total | $16,285.1 | \t$14,859.7 | \t$14,171.8 |
| Segment\tincome: |  |  |  |
| Corrugated\tPackaging | $1,207.9 | \t$753.9 | \t$739.9 |
| Consumer\tPackaging | 454.6 | 425.8 | 481.7 |
| Land\tand\tDevelopment | 22.5 | 13.8 | 4.6 |
| Segment\tincome | 1,685.0 | 1,193.5 | 1,226.2 |
| Multiemployer\tpension\twithdrawals | (184.2) | — | — |
| Pension\trisk\ttransfer\texpense | — | — | (370.7) |
| Pension\tlump\tsum\tsettlement | — | (32.6) | — |
| Land\tand\tDevelopment\timpairments | (31.9) | (46.7) | — |
| Restructuring\tand\tother\tcosts | (105.4) | (196.7) | (366.4) |
| Non-allocated\texpenses | (47.5) | (43.5) | (49.1) |
| Interest\texpense,\tnet | (293.8) | (222.5) | (212.5) |
| Gain\ton\textinguishment\tof\tdebt | (0.1) | 1.8 | 2.7 |
| Other\tincome,\tnet | 12.7 | 11.5 | 14.4 |
| Gain\ton\tsale\tof\tHH&amp;B | — | 192.8 | — |
| Income\tfrom\tcontinuing\toperations\tbefore\tincome\ttaxes | $1,034.8 | \t$857.6 | \t$244.6 |

Segment	income	in	fiscal	2018,	2017	and	2016	was	reduced	by	$1.0	million,	$26.5	million	and	$8.1	million,	respectively,	of	expense	for	inventory stepped-up	 in	 purchase	 accounting,	 net	 of	 related	 LIFO	 impact.	 Corrugated	 Packaging	 segment	 income	 in	 fiscal	 2018	 was	 reduced	 by	 $1.0	 million. Corrugated	 Packaging	 segment	 income	 and	 Consumer	 Packaging	 segment	 income	 in	 fiscal	 2017	 were	 reduced	 by	 $1.4	 million	 and	 $25.1	 million, respectively.	The	Corrugated	Packaging	segment	income	and	Consumer	Packaging	segment	income	in	fiscal	2016	were	reduced	by	$3.4	million	and	$4.7 million,	respectively.

|  | 2018 | Years	Ended	September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Identifiable\tassets: |  |  |  |
| Corrugated\tPackaging | $10,678.5 | $10,537.7 | $10,046.0 |
| Consumer\tPackaging | 11,902.2 | 11,877.8 | 10,122.5 |
| Land\tand\tDevelopment | 49.1 | 89.8 | 460.6 |
| Assets\theld\tfor\tsale | 59.5 | 173.6 | 52.3 |
| Corporate | 2,671.2 | 2,410.1 | 2,356.8 |
| Total | $25,360.5 | $25,089.0 | $23,038.2 |
| Goodwill: |  |  |  |
| Corrugated\tPackaging | $1,890.9 | $1,865.7 | $1,722.5 |
| Consumer\tPackaging | 3,686.7 | 3,662.6 | 3,055.6 |
| Total | $5,577.6 | $5,528.3 | $4,778.1 |
| Depreciation\tand\tamortization: |  |  |  |
| Corrugated\tPackaging | $676.8 | $597.9 | $576.2 |
| Consumer\tPackaging | 569.3 | 508.2 | 498.9 |
| Land\tand\tDevelopment | 0.7 | 0.7 | 1.4 |
| Discontinued\toperations | — | — | 57.2 |
| Corporate | 5.4 | 5.3 | 8.2 |
| Total | $1,252.2 | $1,112.1 | $1,141.9 |
| Capital\texpenditures: |  |  |  |
| Corrugated\tPackaging | $647.8 | $492.1 | $490.1 |
| Consumer\tPackaging | 317.8 | 265.8 | 244.9 |
| Discontinued\toperations | — | — | 45.2 |
| Corporate | 34.3 | 20.7 | 16.5 |
| Total | $999.9 | $778.6 | $796.7 |
| Investment\tin\tunconsolidated\tentities: |  |  |  |
| Corrugated\tPackaging | $435.7 | $321.1 | $281.2 |
| Consumer\tPackaging | 21.7 | 24.7 | 22.2 |
| Land\tand\tDevelopment | — | 14.4 | 28.6 |
| Corporate | 0.4 | 0.4 | (3.1) |
| Total | $457.8 | $360.6 | $328.9 |

The	Corrugated	Packaging	segment's	investment	in	unconsolidated	entities	primarily	relate	to	the	Grupo	Gondi	investment.	The	Corporate	investment in	unconsolidated	entities	in	fiscal	2016	primarily	represented	an	entity	that	had	losses	that	were	guaranteed	equally	by	the	partners;	this	subsidiary	has since	been	sold.	The	investment	in	Grupo	Gondi	that	is	included	in	the	Corrugated	Packaging	segment's	investment	in	unconsolidated	entities	in	fiscal	2018 and	 2017	 exceeds	 our	 proportionate	 share	 of	 the	 underlying	 equity	 in	 net	 assets	 by	 approximately	 $133.9	 million	 and	 $76.2	 million,	 respectively. Approximately	$62.1	million	and	$59.2	million	remains	amortizable	to	expense	in	equity	in	income	of	unconsolidated	entities	over	the	estimated	life	of	the underlying	assets	ranging	from	10	to	15	years	beginning	with	our	investment	in	fiscal	2016.	See	"Note	2.	Mergers,	Acquisitions	and	Investment "	for information	regarding	changes	in	our	equity	participation	in	the	Grupo	Gondi	joint	venture.

The	changes	in	the	carrying	amount	of	goodwill	for	the	fiscal	years	ended	September	30,	2018,	2017	and	2016	are	as	follows	(in	millions):

|  | Corrugated<br>Packaging | Consumer<br>Packaging | Total |
| :--- | :--- | :--- | :--- |
| Balance\tas\tof\tOctober\t1,\t2015 |  |  |  |
| Goodwill | $1,667.5 | $3,022.4 | $4,689.9 |
| Accumulated\timpairment\tlosses | — | (42.8) | (42.8) |
|  | 1,667.5 | 2,979.6 | 4,647.1 |
| Goodwill\tacquired | 52.4 | 8.0 | 60.4 |
| Goodwill\tdisposed\tof | (24.0) | — | (24.0) |
| Purchase\tprice\tallocation\tadjustments | (4.9) | 67.6 | 62.7 |
| Translation\tadjustments | 31.5 | 0.4 | 31.9 |
| Balance\tas\tof\tSeptember\t30,\t2016 |  |  |  |
| Goodwill | 1,722.5 | 3,098.4 | 4,820.9 |
| Accumulated\timpairment\tlosses | — | (42.8) | (42.8) |
|  | 1,722.5 | 3,055.6 | 4,778.1 |
| Goodwill\tacquired | 137.6 | 907.8 | 1,045.4 |
| Goodwill\tdisposed\tof | — | (329.6) | (329.6) |
| Purchase\tprice\tallocation\tadjustments | (1.2) | 9.3 | 8.1 |
| Translation\tadjustments | 6.8 | 19.5 | 26.3 |
| Balance\tas\tof\tSeptember\t30,\t2017 |  |  |  |
| Goodwill | 1,865.7 | 3,705.4 | 5,571.1 |
| Accumulated\timpairment\tlosses | — | (42.8) | (42.8) |
|  | 1,865.7 | 3,662.6 | 5,528.3 |
| Goodwill\tacquired | 65.4 | 23.8 | 89.2 |
| Goodwill\tdisposed\tof | (4.2) | — | (4.2) |
| Purchase\tprice\tallocation\tadjustments | 2.3 | 18.4 | 20.7 |
| Translation\tadjustments | (38.3) | (18.1) | (56.4) |
| Balance\tas\tof\tSeptember\t30,\t2018 |  |  |  |
| Goodwill | 1,890.9 | 3,729.5 | 5,620.4 |
| Accumulated\timpairment\tlosses | — | (42.8) | (42.8) |
|  | $1,890.9 | $3,686.7 | $5,577.6 |

The	goodwill	acquired	in	fiscal	2018	primarily	related	to	the	Plymouth	Packaging	Acquisition	in	the	Corrugated	Packaging	segment	and	the	Schlüter Acquisition	in	the	Consumer	Packaging	segment.	The	purchase	price	adjustments	to	goodwill	in	fiscal	2018	primarily	related	to	the	MPS	Acquisition	and	the Hannapak	Acquisition.	The	goodwill	acquired	in	fiscal	2017	related	to	the	MPS	Acquisition	and	the	Hannapak	Acquisition	in	the	Consumer	Packaging segment	and	the	U.S.	Corrugated	Acquisition,	the	Island	Container	Acquisition	and	the	Star	Pizza	Acquisition	in	the	Corrugated	Packaging	segment.	The goodwill	disposed	of	in	the	Corrugated	Packaging	segment	in	fiscal	2018	related	to	the	sale	of	our	solid	waste	management	brokerage	services	business. The	goodwill	disposed	of	in	the	Consumer	Packaging	segment	in	fiscal	2017	was	primarily	related	to	the	HH&B	Sale.	The	goodwill	acquired	in	fiscal	2016 related	to	the	SP	Fiber	Acquisition	and	the	Packaging	Acquisition	in	the	Corrugated	Packaging	and	Consumer	Packaging	segments,	respectively.	The goodwill	disposed	of	in	the	Corrugated	Packaging	segment	in	fiscal	2016	relates	to	the	disposal	of	a	portion	of	the	reporting	unit	in	connection	with	the investment	in	the	Grupo	Gondi	unconsolidated	joint	venture.	See	"Note	2.	Mergers,	Acquisitions	and	Investment"	for	additional	information.

# Note	7. Discontinued	Operations

On	May	15,	2016,	WestRock	completed	 the	Separation.	We	distributed	100%	of	 the	outstanding	common	stock,	par	value	$0.01	per	share,	of Ingevity,	 then	a	wholly-owned	subsidiary	of	WestRock,	 to	WestRock's	stockholders	of	record	as	of	 the	close	of	business	on	May	4,	2016,	with	such stockholders	receiving	one	share	of	Ingevity	common	stock	for	every	six	shares	of	Common	Stock	held	as	of	such	record	date.	Since	the	Separation,	we have	not	beneficially	owned	any	shares	of	Ingevity	common	stock	and	Ingevity	has	been	an	independent	public

company	trading	under	the	symbol	"NGVT"	on	the	NYSE.	We	disposed	of	the	former	Specialty	Chemicals	segment	in	its	entirety	and	ceased	to	consolidate its	assets,	liabilities	and	results	of	operations.	Accordingly,	we	have	presented	the	financial	position	and	results	of	operations	of	our	former	Specialty Chemicals	segment	as	discontinued	operations	in	the	accompanying	consolidated	financial	statements	for	all	periods	presented.

In	connection	with	the	Separation,	we	and	Ingevity	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	wholly-owned	subsidiary	of	WestRock,	borrowed	$500.0	million	 in	contemplation	of	 the	Separation	and distributed	the	majority	of	these	funds	to	WestRock,	which	used	the	funds	to	pay	down	debt.	In	addition,	Ingevity	assumed	an	$80.0	million,	7.67%	capital lease	obligation	due	January	15,	2027	owed	to	the	City	of	Wickliffe,	KY.	In	contemplation	of	the	Separation,	Ingevity	also	funded	a	trust	in	the	amount	of $68.9	million	to	secure	the	balloon	principal	payment	of	the	capital	lease	upon	the	lease's	maturity.	We	remain	a	co-obligor	on	the	capital	lease	obligation; therefore,	the	capital	lease	assumed	by	Ingevity	remains	recorded	in	our	consolidated	financial	statements	in	long-term	debt.	At	the	time	of	the	Separation, we	recorded	a	$108.2	million	long-term	asset	for	the	estimated	fair	value	of	the	future	principal	and	interest	payments	on	the	capital	lease	obligation assumed	by	Ingevity.	The	value	of	the	long-term	asset	and	the	long-term	debt	under	the	lease	will	reduce	over	the	life	of	the	lease	using	the	effective interest	method.	The	$500.0	million	of	debt	and	the	$68.9	million	in	the	trust	were	assumed	by	Ingevity,	and	removed	from	our	consolidated	financial statements	as	part	of	our	discontinued	operations	reporting.

The	following	table	presents	the	financial	results	of	Specialty	Chemicals'	discontinued	operations	(in	millions):

|  | 2016 |
| :--- | :--- |
| Net\tsales | $533.7 |
| Cost\tof\tgoods\tsold | 387.5 |
| Selling,\tgeneral\tand\tadministrative,\texcluding\tintangible\tamortization | 65.6 |
| Selling,\tgeneral\tand\tadministrative\tintangible\tamortization | 28.8 |
| Restructuring\tand\tother\tcosts | 49.5 |
| Impairment\tof\tSpecialty\tChemicals\tgoodwill\tand\tintangibles | 579.4 |
| Operating\tloss | (577.1) |
| Interest\tincome\t(expense)\tand\tother\tincome\t(expense),\tnet | 0.1 |
| Loss\tfrom\tdiscontinued\toperations\tbefore\tincome\ttaxes | (577.0) |
| Income\ttax\tbenefit | 32.3 |
| Loss\tfrom\tdiscontinued\toperations | $(544.7) |

Fiscal	2016	restructuring	and	other	costs	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	include	$10.0	million	of	costs	associated	with	the	closure	of	Ingevity's Duque	de	Caxias	facility	in	Brazil	and	other	severance	and	share-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	Combination.

Accordingly,	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	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	was	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,	we	assessed	Specialty	Chemical's	assets	for potential	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	the	Specialty	Chemical's	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	consolidated statements	of	cash	flows	(in	millions):

Depreciation	expense	and	amortization	expense	in	fiscal	2016	were	$30.4	million	$26.8	million,	respectively.

# Note	8. Inventories

Inventories	are	as	follows	(in	millions):

|  | September	30, |  |
| :--- | :--- | :--- |
|  | 2018 | 2017 |
| Finished\tgoods\tand\twork\tin\tprocess | $867.0 | $905.0 |
| Raw\tmaterials | 730.0 | 614.2 |
| Supplies\tand\tspare\tparts | 368.2 | 360.7 |
| Inventories\tat\tFIFO\tcost | 1,965.2 | 1,879.9 |
| LIFO\treserve | (135.6) | (82.6) |
| Net\tinventories | $1,829.6 | $1,797.3 |

It	is	impracticable	to	segregate	the	LIFO	reserve	between	raw	materials,	finished	goods	and	work	in	process.	In	fiscal	2018	and	2016,	we	reduced inventory	quantities	in	some	of	our	LIFO	pools.	These	reductions	result	in	liquidations	of	LIFO	inventory	quantities	generally	carried	at	lower	costs	prevailing in	prior	years	as	compared	with	the	cost	of	the	purchases	in	the	respective	fiscal	years,	the	effect	of	which	typically	decreases	cost	of	goods	sold.	The impact	of	the	liquidations	in	fiscal	2018	and	2016	was	not	significant.	In	fiscal	2017,	we	had	no	LIFO	layer	liquidations.

# Note	9. Assets	Held	For	Sale

Due	to	the	accelerated	monetization	strategy,	our	Land	and	Development	portfolio	has	met	the	held	for	sale	criteria	and	is	reflected	as	assets	held	for sale.	Assets	held	for	sale	at	September	30,	2018	of	$59.5	million	include	$33.5	million	of	Land	and	Development	portfolio	assets,	with	the	remainder primarily	related	to	closed	facilities.	Assets	held	for	sale	at	September	30,	2017	of	$173.6	million	include	$150.4	million	of	Land	and	Development	portfolio assets,	with	the	remainder	primarily	related	to	closed	facilities.

# Note	10. Property,	Plant	and	Equipment

Property,	plant	and	equipment	consists	of	the	following	(in	millions):

|  | September	30,<br>2018 | 2017 |
| :--- | :--- | :--- |
| Property,\tplant\tand\tequipment\tat\tcost: |  |  |
| Land\tand\tbuildings | $2,078.9 | $2,034.3 |
| Machinery\tand\tequipment | 12,064.0 | 11,349.7 |
| Forestlands\tand\tmineral\trights | 158.0 | 208.3 |
| Transportation\tequipment | 30.1 | 30.7 |
| Leasehold\timprovements | 88.9 | 59.5 |
|  | 14,419.9 | 13,682.5 |
| Less:\taccumulated\tdepreciation,\tdepletion\tand\tamortization | (5,337.4) | (4,564.2) |
| Property,\tplant\tand\tequipment,\tnet | $9,082.5 | $9,118.3 |

Depreciation	expense,	excluding	discontinued	operations,	 for	 fiscal	2018,	2017	and	2016	was	$923.8	million,	$855.9	million	and	$848.9	million, respectively.	For	depreciation	expense	related	to	our	discontinued	operations	see	"Note	7.	Discontinued	Operations".

# Note	11. Other	Intangible	Assets

The	gross	carrying	amount	and	accumulated	amortization	relating	to	intangible	assets,	excluding	goodwill,	is	as	follows	(in	millions,	except	weighted avg.	life):

|  | Avg.	Life | Gross	Carrying | Accumulated | Gross	Carrying | Accumulated |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | (in\tyears) | Amount | Amortization | Amount | Amortization |
| Customer\trelationships | 16.7 | $4,123.7 | $(1,079.8) | $4,046.2 | $(806.0) |
| Favorable\tcontracts | 10.1 | 47.8 | (34.8) | 48.2 | (30.7) |
| Technology\tand\tpatents | 10.7 | 41.2 | (18.0) | 31.8 | (14.4) |
| Trademarks\tand\ttradenames | 19.8 | 77.6 | (43.9) | 74.7 | (31.4) |
| Non-compete\tagreements | 2.0 | 3.4 | (1.7) | 2.5 | (0.6) |
| License\tcosts | 9.6 | 24.6 | (18.1) | 23.6 | (14.6) |
| Total | 16.6 | $4,318.3 | $(1,196.3) | $4,227.0 | $(897.7) |

Estimated	intangible	asset	amortization	expense	for	the	succeeding	five	fiscal	years	is	as	follows	(in	millions):

| Fiscal	2019 | $300.1 |
| :--- | :--- |
| Fiscal\t2020 | $289.6 |
| Fiscal\t2021 | $243.8 |
| Fiscal\t2022 | $234.6 |
| Fiscal\t2023 | $226.4 |

Intangible	amortization	expense,	excluding	discontinued	operations,	was	$300.8	million,	$234.0	million	and	$212.4	million	during	fiscal	2018,	2017	and 2016,	respectively.	We	had	other	intangible	amortization	expense,	primarily	for	packaging	equipment	leased	to	customers	of	$27.6	million,	$22.2	million	and $23.4	million	during	fiscal	2018,	2017	and	2016.	For	amortization	expense	related	to	our	discontinued	operations	see	"Note	7.	Discontinued	Operations".

# Note	12. 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	long-term	debt	in	" Note	13.	Debt"	and	the	fair	value	of	our	pension	and	postretirement	assets	and	liabilities	in	" Note 4.	Retirement	Plans".	We	have,	or	from	time	to	time	may	have,	various	assets	or	liabilities	whose	fair	values	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.	See	"Note	1	—	Description	of	Business	and	Summary	of	Significant Accounting	Policies	—	Fair	Value	of	Financial	Instruments	and	Nonfinancial	Assets	and	Liabilities"	for	additional	information.

# Accounts	Receivable	Sales	Agreement

We	had	an	agreement	(the	"A/R	Sales	Agreement"),	which	had	been	amended	periodically,	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.	On	September	29, 2017,	the	A/R	Sales	Agreement	was	amended	to	increase	the	maximum	outstanding	balance	of	receivables	available	to	be	sold	to	$490.0	million,	and	we added	new	customer	trade	accounts	as	well	as	increased	the	limits	for	other	customers.	On	September	25,	2018,	we	terminated	the	A/R	Sales	Agreement and	executed	a	new	agreement.

On	September	25,	2018	we	entered	into	a	$550.0	million	agreement	 (the	"New	A/R	Sales	Agreement")	to	sell	to	a	third	party	financial	institution	all	of the	short-term	receivables	generated	from	certain	customer	trade	accounts.	The	agreement	terminates	the	earlier	of	one	year	or	when	terminated	by	either party.	The	terms	of	the	New	A/R	Sales	Agreement	limit	the	balance	of	receivables	sold	to	the	amount	available	to	fund	such	receivables	sold	and	eliminated the	receivable	for	proceeds	from	the	financial	institution	at	any	transfer	date.	Transfers	under	the	New	A/R	Sales	Agreement	meet	the	requirements	to	be accounted	for	as	sales	in	accordance	with	guidance	in	ASC	860,	" Transfers	and	Servicing".	These	customers	are	not	included	in	the	Receivables	Facility that	is	discussed	in	"Note	13.	Debt".	In	connection	with	the	termination	of	the	old	agreement	and	execution	of	the	New	A/R	Sales	Agreement,	there	was	a non-cash	transaction	of	$424.8	million	representing	the	repurchase	of	receivables	previously	sold	to	the	financial	institution	under	the	old	agreement	and	the sale	of	the	same	receivables	to	the	financial	institution	under	the	New	A/R	Sales	Agreement.

The	following	table	represents	a	summary	of	the	activity	under	the	A/R	Sales	Agreement	and	the	New	A/R	Sales	Agreement	for	fiscal	2018	and	2017 (in	millions):

|  | 2018 | 2017 |
| :--- | :--- | :--- |
| Receivable\tfrom\tfinancial\tinstitution\tat\tbeginning\tof\tfiscal\tyear | $24.9 | $13.8 |
| Receivables\tsold\tto\tthe\tfinancial\tinstitution\tand\tderecognized | 1,664.0 | 1,542.5 |
| Receivables\tcollected\tby\tfinancial\tinstitution | (1,573.8) | (1,466.7) |
| Cash\tproceeds\tfrom\tfinancial\tinstitution | (115.1) | (64.7) |
| Receivable\tfrom\tfinancial\tinstitution\tat\tSeptember\t30, | $— | $24.9 |

Cash	proceeds	related	 to	 the	receivables	sold	are	 included	 in	cash	 from	operating	activities	 in	 the	consolidated	statement	of	cash	 flows	 in	 the accounts	receivable	line	item.	The	expense	recorded	in	connection	with	the	sale	is	currently	approximately	$11	million	per	year	and	is	recorded	in	"other income,	net".	The	future	amount	may	fluctuate	based	on	the	level	of	activity	and	other	factors.	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.	See	"Note	13.	Debt"	for	the	fair	value	of	our	long- term	debt.

# Fair	Value	of	Nonfinancial	Assets	and	Nonfinancial	Liabilities

We	measure	certain	nonfinancial	assets	and	nonfinancial	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	fiscal	2018,	2017	and	2016,	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	following	pre-tax	non-cash	impairments:	(i)	the $31.9	million	impairment	of	certain	mineral	rights	and	real	estate	in	fiscal	2018,	(ii)	the	$46.7	million	real	estate	impairment	recorded	in	fiscal	2017,	(iii)	a $17.6	million	write-down	of	a	customer	relationship	intangible	in	fiscal	2017	related	to	an	exited	product	line,	and	(iv)	the	goodwill	and	intangible	impairments in	our	former	Specialty	Chemicals	segment	in	fiscal	2016.	We	discuss	the	former	Specialty	Chemicals	impairments	in	"Note	7.	Discontinued	Operations". The	impairment	of	mineral	rights	was	driven	by	the	non-renewal	of	a	lease	and	associated	with	declining	oil	and	gas	prices,	and	the	impairment	of	real estate	was	in	connection	with	the	accelerated	monetization	strategy	in	our	Land	and	Development	segment	where	the	projected	sales	proceeds	were	less than	the	carrying	value.

The	public	bonds	issued	by	WestRock	RKT	Company	and	WestRock	MWV,	LLC	are	guaranteed	by	WestRock	and	have	cross-guarantees	between the	two	companies.	The	industrial	development	bonds	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.	The	bonds	are	effectively	subordinated	to	any	of	our	existing	and	future	secured	debt	to	the	extent	of	the	value	of	the	assets securing	such	debt.	At	September	30,	2018,	our	Credit	Facility,	Farm	Loan	Credit	Facility,	European	Revolving	Credit	Facility,	Delayed	Draw	Credit Facilities,	Commercial	Paper	Program,	Other	Revolving	Credit	Facilities	(each	as	defined	below)	and	public	bonds	were	unsecured.

The	following	were	individual	components	of	debt	(in	millions,	except	percentages):

|  | September	30,	2018 |  | September	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | Carrying\tValue | Weighted\tAvg\nInterest\tRate | Carrying\tValue | Weighted\tAvg\nInterest\tRate |
| Public\tbonds\tdue\tfiscal\t2019\tto\t2022 | $1,470.9 | 4.2% | $1,484.5 | 4.2% |
| Public\tbonds\tdue\tfiscal\t2023\tto\t2028 | 2,534.4 | 3.8% | 1,368.8 | 3.6% |
| Public\tbonds\tdue\tfiscal\t2030\tto\t2033 | 964.1 | 5.2% | 975.5 | 5.2% |
| Public\tbonds\tdue\tfiscal\t2037\tto\t2047 | 178.5 | 6.3% | 178.8 | 6.3% |
| Term\tloan\tfacilities | 599.4 | 3.7% | 1,622.7 | 2.5% |
| Revolving\tcredit\tand\tswing\tfacilities | 355.0 | 3.2% | 436.4 | 1.1% |
| Receivables-backed\tfinancing\tfacility | — | N/A | 110.0 | 2.1% |
| Capital\tlease\tobligations | 171.0 | 4.1% | 177.0 | 4.3% |
| Supplier\tfinancing\tand\tcommercial\tcard\tprograms | 105.1 | N/A | 130.3 | N/A |
| International\tand\tother\tdebt | 36.8 | 6.1% | 70.8 | 6.8% |
| Total\tdebt | 6,415.2 | 4.1% | 6,554.8 | 3.6% |
| Less:\tcurrent\tportion\tof\tdebt | 740.7 |  | 608.7 |  |
| Long-term\tdebt\tdue\tafter\tone\tyear | $5,674.5 |  | $5,946.1 |  |

A	portion	of	the	debt	classified	as	long-term,	may	be	paid	down	earlier	than	scheduled	at	our	discretion	without	penalty.	Certain	customary	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	September	30,	2018.	The	carrying	value	of	our	debt	includes	the	fair	value	step-up	of	debt	acquired	in	mergers	and acquisitions.	At	September	30,	2018,	the	unamortized	fair	market	value	step-up	was	$250.8	million,	which	will	be	amortized	over	a	weighted	average remaining	life	of	12.3	years.	The	weighted	average	interest	rate	also	includes	the	fair	value	step	up.	Excluding	the	step-up,	the	weighted	average	interest rate	on	total	debt	was	4.6%.	At	September	30,	2018,	we	had	$104.9	million	of	outstanding	letters	of	credit	not	drawn	upon.	At	September	30,	2018,	we	had approximately	$3.2	billion	of	availability	under	our	committed	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	$6.4 billion	and	$6.8	billion	as	of	September	30,	2018	and	September	30,	2017,	respectively.	The	fair	value	of	our	long-term	debt	is	categorized	as	level	2	within the	fair	value	hierarchy	and	is	primarily	either	based	on	quoted	prices	for	those	or	similar	instruments,	or	approximately	the	carrying	amount,	as	the	variable interest	rates	reprice	frequently	at	observable	current	market	rates.	During	fiscal	2018,	2017	and	2016,	amortization	of	debt	issuance	costs	charged	to interest	expense	were	$6.3	million,	$4.5	million	and	$4.6	million,	respectively.

# Public	Bonds	/	Notes	Issued

On	March	6,	2018,	we	issued	$600.0	million	aggregate	principal	amount	of	3.75%	senior	notes	due	2025	and	$600.0	million	aggregate	principal amount	of	4.0%	senior	notes	due	2028	(collectively,	the	"Notes")	in	an	unregistered	offering	pursuant	to	Rule	144A	and	Regulation	S	under	the	Securities Act	of	1933,	as	amended,	at	a	discount	of	approximately	$1.7	million	and	$1.0	million,	respectively.	In	connection	with	issuing	the	Notes,	we	recorded	debt issuance	costs	of	$4.9	million	and	$5.0	million,	respectively,	which	are	being	amortized	over	 the	respective	 terms	of	 the	Notes.	 Giving	 effect	 to	 the amortization	of	the	original	issue	discount	and	the	debt	issuance	costs,	the	effective	interest	rates	of	the	Notes	were	3.93%	and	4.12%,	respectively. WestRock	MWV,	LLC	and	WestRock	RKT	Company	have	guaranteed	the	Company's	obligations	under	the	Notes.	The	Company	may	redeem	the	Notes, in	whole	or	in	part,	at	any	time	at	specified	redemption	prices,	plus	accrued	and	unpaid	interest,	if	any.	The	proceeds	from	the	issuance	of	the	Notes	were used	primarily	to	pay	down	the	remaining	$540.0	million	of	our	then	existing	term	loan	facility,	pay	down	$445.0	million	of	our	commercial	paper	program, pay	down	$100.0	million	of	our	Receivables	Facility	and	pay	down	$104.7	million	of	our	Sumitomo	Credit	Facility	(as	hereinafter	defined).

On	August	 24,	 2017,	 we	 issued	 $500.0	 million	 aggregate	 principal	 amount	 of	 3.0%	 Senior	 Notes	 due	 September	 15,	 2024	 and	 $500.0	 million aggregate	principal	amount	of	3.375%	Senior	Notes	due	September	15,	2027	in	an	unregistered	offering	pursuant	to	Rule	144A	and	Regulation	S	under	the Securities	Act	at	a	discount	of	approximately	$1.4	million	and	$0.2	million,	respectively,	and	recorded	debt	issuance	costs	of	$4.2	million	and	$4.3	million, respectively,	which	are	being	amortized	over	the	respective	terms	of	the	notes.	Giving	effect	to	the	amortization	of	the	original	issue	discount	and	the	debt issuance	costs,	the	effective	interest	rates	of	the	notes	are	3.18%	and	3.48%,	respectively.	The	proceeds	from	the	issuance	of	the	notes	was	used	to	pre- pay	$575.0	million	of	amortization	payments	through	the	maturity	of	our	term	loan	and	$415.0	million	then	outstanding	on	the	Receivables	Facility.

# Term	Loan	Facilities	and	Revolving	Credit	Facility

In	connection	with	the	Combination,	on	July	1,	2015,	we	entered	into	a	credit	agreement	(the	" Credit	Agreement"),	which	provided	for	a	5-year	senior unsecured	term	loan	in	an	aggregate	principal	amount	of	$2.3	billion	and	a	5-year	senior	unsecured	revolving	credit	facility	in	an	aggregate	committed principal	amount	of	$2.0	billion	(together	the	"Credit	Facility").	On	July	1,	2015,	we	drew	$1.2	billion	of	the	$2.3	billion	unsecured	term	loan	and	$1.1	billion was	available	to	be	drawn	on	a	delayed	draw	basis	not	later	than	April	1,	2016	in	up	to	two	separate	draws.	Certain	proceeds	of	the	Credit	Facility	were used	to	repay	certain	indebtedness	of	our	subsidiaries	at	the	time	of	the	Combination,	including	the	then	existing	RockTenn	credit	facility,	and	to	pay	fees and	expenses	incurred	in	connection	with	the	Combination.	The	Credit	Facility	is	unsecured	and	is	guaranteed	by	WestRock's	wholly-owned	subsidiaries WestRock	RKT	Company	and	WestRock	MWV,	LLC.	On	March	24,	2016,	we	drew	$600.0	million	of	the	then	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	the	term	loan	amortization	payments	due	through	the	second	quarter	of	fiscal	2018.	On	August	24,	2017,	in	connection	with	the	issuance	of	public	bonds, we	pre-paid	$575.0	million	of	the	term	loan	amortization	payments	due	through	the	maturity	of	the	term	loan.	The	carrying	value	of	this	term	loan	facility	at September	30,	2017	was	$1,023.5	million.	On	October	31,	2017,	we	pre-paid	$485.0	million	of	the	outstanding	principal	balance	by	borrowing	on	our Receivables	Facility.	On	March	14,	2018,	in	connection	with	the	issuance	of	public	bonds,	we	pre-paid	the	remaining	$540.0	million	principal	balance.

On	July	1,	2016,	we	executed	an	option	to	extend	the	term	of	the	5-year	senior	unsecured	revolving	credit	facility	for	one	year	beyond	the	original term.	On	June	30,	2017,	we	executed	an	option	to	extend	the	term	of	the	facility	for	a	second	additional	year.	Approximately	$1.9	billion	of	the	original	$2.0 billion	aggregate	committed	principal	amount	has	been	extended	to	July	1,	2022,	and	the	remainder	will	continue	to	mature	on	July	1,	2020.	Up	to	$150 million	under	the	revolving	credit	facility	may	be	used	for	the	issuance	of	letters	of	credit.	In	addition,	up	to	$400	million	of	the	revolving	credit	facility	may	be used	to	fund	borrowings	in	non-U.S.	dollar	currencies	including	Canadian	dollars,	Euro	and	Pound	Sterling.	Additionally,	we	may	request	up	to	$200	million of	the	revolving	credit	facility	to	be	allocated	to	a	Mexican	peso	revolving	credit	facility.	At	September	30,	2018	and	September	30,	2017,	we	had	no amounts	outstanding	under	the	revolving	credit	facility.

At	our	option,	loans	issued	under	the	Credit	Facility	will	bear	interest	at	either	the	London	Interbank	Offered	Rate	(" LIBOR")	or	an	alternate	base	rate, in	each	case	plus	an	applicable	interest	rate	margin.	Loans	will	initially	bear	interest	at	LIBOR	plus	1.125%	per	annum,	in	the	case	of	LIBOR	borrowings,	or at	the	alternate	base	rate	plus	0.125%	per	annum,	in	the	alternative,	and	thereafter	the	interest	rate	will	fluctuate	between	LIBOR	plus	1.00%	per	annum and	LIBOR	plus	1.50%	per	annum	(or	between	the	alternate	base	rate	plus	0.00%	per	annum	and	the	alternate	base	rate	plus	0.50%	per	annum),	based upon	our	corporate	credit	ratings	or	the	leverage	ratio	(as	defined	in	the	Credit	Agreement)	(whichever	yields	a	lower	applicable	interest	rate	margin)	at	such time.	In	addition,	we	will	be	required	to	pay	fees	that	will	fluctuate	between	0.125%	per	annum	to	0.25%	per	annum	on	the	unused	amount	of	the	revolving credit	facility,	based	upon	our	corporate	credit	ratings	or	the	leverage	ratio	(whichever	yields	a	lower	fee)	at	such	time.	Loans	under	the	Credit	Facility	may be	prepaid	at	any	time	without	premium.

The	Credit	Agreement	contains	usual	and	customary	representations	and	warranties,	and	usual	and	customary	affirmative	and	negative	covenants, including:	financial	covenants	(including	maintenance	of	a	maximum	consolidated	debt	to	capitalization	ratio	and	a	minimum	consolidated	interest	coverage ratio,	as	defined	in	the	Credit	Agreement)	and	limitations	on	liens,	additional	indebtedness	and	asset	sales	and	mergers.	The	Credit	Agreement	also contains	usual	and	customary	events	of	default,	including:	non-payment	of	principal,	interest,	fees	and	other	amounts;	material	breach	of	a	representation	or warranty;	default	on	other	material	debt;	bankruptcy	or	insolvency;

incurrence	of	certain	material	ERISA	liabilities;	material	judgments;	impairment	of	loan	documentation;	change	of	control;	and	material	breach	of	obligations under	securitization	programs.

On	 July	 1,	 2015,	 three	 WestRock	 wholly-owned	 subsidiaries,	 RockTenn	 CP,	 LLC,	 a	 Delaware	 limited	 liability	 company,	 Rock-Tenn	 Converting Company,	a	Georgia	corporation,	and	MeadWestvaco	Virginia	Corporation,	a	Delaware	corporation,	as	borrowers,	entered	into	a	credit	agreement	(the "Farm	Loan	Credit	Agreement")	with	CoBank	ACB,	as	administrative	agent.	The	Farm	Loan	Credit	Agreement	provides	for	a	7-year	senior	unsecured term	loan	in	an	aggregate	principal	amount	of	$600.0	million	(the	"Farm	Loan	Credit	Facility").	The	Farm	Credit	Facility	is	guaranteed	by	WestRock Company,	WestRock	RKT	Company	and	WestRock	MWV,	LLC.	The	carrying	value	of	this	facility	at	September	30,	2018	and	September	30,	2017	was $599.4	million	and	$599.2	million,	respectively.

# European	Revolving	Credit	Facility

On	May	15,	2017,	we	entered	into	a	$600.0	million	European	revolving	credit	facility	with	Coöperatieve	Rabobank	U.A.,	New	York	Branch	as	the administrative	agent	for	the	syndicate	of	banks.	This	facility	provided	for	a	364-day	unsecured	U.S.	dollar,	Euro	and	Sterling	denominated	borrowing	of	not more	than	$600.0	million.	The	facility	was	set	to	mature	on	May	14,	2018.	The	carrying	value	of	this	facility	at	September	30,	2017	was	$211.6	million.	On April	27,	2018,	we	repaid	all	amounts	outstanding	and	the	facility	was	closed.

On	April	27,	2018,	we	entered	into	a	€500.0	million	revolving	credit	facility	with	an	incremental	€100.0	million	accordion	feature	with	 Coöperatieve Rabobank	U.A.,	New	York	Branch	as	the	administrative	agent	for	the	syndicate	of	banks	(the	"European	Revolving	Credit	Facility").	This	facility	provides for	a	3-year	unsecured	U.S.	dollar,	Euro	and	Sterling	denominated	borrowing	of	not	more	than	€500.0	million	and	matures	on	April	27,	2021.	This	facility replaced	the	$600.0	million	European	Revolving	Credit	Facility	as	discussed	above.	At	September	30,	2018,	we	had	borrowed	$355.0	million	under	this	new facility	and	entered	into	foreign	currency	exchange	contracts	of	$356.0	million	as	an	economic	hedge	for	the	U.S.	dollar	denominated	borrowing	plus	interest by	 a	 non-U.S.	 dollar	 functional	 currency	 entity.	The	 net	 of	 gains	 or	 losses	 from	 these	 foreign	 currency	 exchange	 contracts	 and	 the	 changes	 in	 the remeasurement	of	the	U.S.	dollar	denominated	borrowing	in	our	foreign	subsidiaries	have	been	immaterial	to	our	statements	of	operations.

# Other	Revolving	Credit	Facilities

On	October	31,	2017,	we	entered	into	a	credit	agreement	with	Wells	Fargo	Bank,	National	Association,	as	administrative	agent,	providing	for	a	364- day	senior	unsecured	revolving	credit	facility	in	an	aggregate	committed	principal	amount	of	$450.0	million.	The	proceeds	of	the	credit	facility	may	be	used for	working	capital	and	for	other	general	corporate	purposes.	The	credit	facility	is	unsecured	and	is	guaranteed	by	WestRock	RKT	Company	and	WestRock MWV,	LLC	and	Whiskey	Holdco,	Inc.	At	our	option,	loans	issued	under	the	credit	facility	will	bear	interest	at	either	LIBOR	or	an	alternate	base	rate,	in	each case	plus	an	applicable	interest	rate	margin.	At	September	30,	2018,	there	were	no	amounts	outstanding	and	the	average	borrowing	rate	under	the	facility would	have	been	3.39%.	On	October	29,	2018,	we	renewed	the	term	of	the	credit	facility	for	another	364	days.	The	facility	now	matures	on	October	28, 2019.

On	February	10,	2017,	we	renewed	the	term	of	our	$200.0	million	uncommitted	and	revolving	line	of	credit	with	Sumitomo	Mitsui	Banking	Corporation (the	"Sumitomo	Credit	Facility").	On	February	7,	2018	we	extended	the	term	of	the	facility	from	February	12,	2018	to	February	12,	2019.	At	September 30,	2018,	there	were	no	amounts	outstanding	under	this	facility.	At	September	30,	2017,	we	had	$106.7	million	outstanding.

	On	March	2,	2017,	we	renewed	our	€100.0	million	uncommitted	and	revolving	line	of	credit	with	Cooperatieve	Rabobank	U.A.,	New	York	Branch.	The facility	is	available	in	Euros	only,	and	continues	until	terminated	in	writing	by	WestRock	or	the	lender.	At	September	30,	2018,	there	were	no	amounts outstanding	under	this	facility.	At	September	30,	2017	we	had	$118.1	million	outstanding.

# Receivables-Backed	Financing	Facility

On	July	22,	2016,	we	entered	into	a	$700.0	million	sixth	amended	and	restated	receivables	sale	agreement	with	certain	originators	(the	" Receivables Facility")	that	matures	on	July	22,	2019.	The	Receivables	Facility	includes	certain	restrictions	on	what	constitutes	eligible	receivables	under	the	facility	and allows	for	the	exclusion	of	eligible

receivables	of	specific	obligors	each	calendar	year	subject	to	the	following	restrictions:	(i)	the	aggregate	of	excluded	receivables	may	not	exceed	7.5%	of eligible	receivables	under	the	Receivables	Facility,	and	(ii)	the	excluded	receivables	of	each	obligor	may	not	exceed	2.5%	of	the	aggregate	outstanding balance.	The	borrowing	rate	consists	of	a	blend	of	the	market	rate	for	asset-backed	commercial	paper	and	the	one	month	LIBOR	rate	plus	a	credit	spread of	0.85%.	The	commitment	fee	was	0.25%	and	0.25%	as	of	September	30,	2018	and	September	30,	2017,	respectively.

Borrowing	availability	under	this	facility	is	based	on	the	eligible	underlying	accounts	receivable	and	compliance	with	certain	covenants.	The	agreement governing	the	Receivables	Facility	contains	restrictions,	including,	among	others,	on	the	creation	of	certain	liens	on	the	underlying	collateral.	We	test	and report	our	compliance	with	these	covenants	monthly;	we	were	in	compliance	with	all	of	these	covenants	at	September	30,	2018.	At	September	30,	2018	and September	30,	2017,	maximum	available	borrowings,	excluding	amounts	outstanding	under	 the	Receivables	Facility,	were	$571.0	million	and	$577.6 million,	 respectively.	 The	 carrying	 amount	 of	 accounts	 receivable	 collateralizing	 the	 maximum	 available	 borrowings	 at	 September	 30,	 2018	 was approximately	$887.0	million.	We	have	continuing	involvement	with	the	underlying	receivables	as	we	provide	credit	and	collections	services	pursuant	to	the Receivables	Facility	agreement.	At	September	30,	2018	there	were	no	amounts	outstanding	under	this	facility	and	the	carrying	value	at	September	30, 2017	was	$110.0	million.

# Commercial	Paper	Program

On	October	31,	2017,	we	established	an	unsecured	commercial	paper	program,	pursuant	to	which	we	may	issue	short-term,	unsecured	commercial paper	notes	in	an	aggregate	principal	amount	at	any	time	not	to	exceed	$1.0	billion	with	up	to	397-day	maturities	(the	"Commercial	Paper	Program").	The Commercial	Paper	Program	has	no	expiration	date	and	can	be	terminated	by	either	the	agent	or	us	with	not	less	than	30	days'	notice.	Our	$2.0	billion unsecured	revolving	credit	facility	is	intended	to	backstop	the	Commercial	Paper	Program.	Amounts	available	under	the	program	may	be	borrowed,	repaid and	re-borrowed	from	time	to	time.	The	net	proceeds	of	issuances	of	the	notes	under	the	program	have	been,	and	are	expected	to	continue	to	be,	used	for general	corporate	purposes.	Our	borrowing	rate	under	the	Commercial	Paper	Program	facility	is	market-determined	and	varies	with	each	issuance.	At September	30,	2018,	there	were	no	amounts	outstanding	under	the	program.

# Delayed	Draw	Credit	Facilities

On	March	7,	2018,	we	entered	into	a	credit	agreement	(the	" Delayed	Draw	Credit	Agreement ")	with	Wells	Fargo	as	administrative	agent	to	provide for	$3.8	billion	of	senior	unsecured	term	loans,	consisting	of	a	364-day	$300.0	million	term	loan,	a	3-year	$1.75	billion	term	loan	and	a	5-year	$1.75	billion term	loan	(collectively,	the	"Delayed	Draw	Credit	Facilities").	In	fiscal	2018,	we	recorded	debt	issuance	costs	of	approximately	$4.0	million,	which	are being	amortized	over	the	respective	terms	of	the	Delayed	Draw	Credit	Facilities.

On	November	2,	2018,	in	connection	with	the	closing	of	the	KapStone	Acquisition	we	drew	upon	the	facility	in	full.	The	proceeds	of	the	Delayed	Draw Credit	Facilities	and	other	sources	of	cash	were	used	to	pay	the	consideration	for	the	KapStone	Acquisition,	to	repay	certain	existing	indebtedness	of KapStone	and	to	pay	fees	and	expenses	incurred	in	connection	with	the	KapStone	Acquisition.	The	Delayed	Draw	Credit	Facilities	are	senior	unsecured obligations	of	the	Company,	as	borrower,	and	each	of	Holdco,	WestRock	RKT	Company	and	WestRock	MWV,	LLC,	respectively,	as	guarantors.

At	our	option,	loans	issued	under	the	Delayed	Draw	Credit	Facilities	will	bear	interest	at	a	floating	rate	based	on	either	LIBOR	or	an	alternate	base rate,	in	each	case	plus	an	applicable	interest	rate	margin.	The	applicable	interest	rate	margin	will	be	1.125%	to	2.000%	per	annum	for	LIBOR	rate	loans	and 0.125%	to	1.000%	per	annum	for	alternate	base	rate	loans,	in	each	case	depending	on	the	Leverage	Ratio	(as	defined	in	the	credit	agreement)	or	Holdco's corporate	credit	ratings,	whichever	yields	a	lower	applicable	interest	rate	margin,	at	such	time.	In	addition,	we	will	be	required	to	pay	a	commitment	fee	of 0.125%	per	annum	to	0.300%	per	annum	(depending	on	the	Leverage	Ratio	or	the	Company's	corporate	credit	ratings,	whichever	yields	a	lower	fee)	on	the unused	term	loan	commitments,	accruing	from	June	5,	2018	until	the	earlier	of	the	funding	of	the	loans	under	the	Delayed	Draw	Credit	Facilities	or	the Delayed	Draw	Termination	Date.	Loans	under	the	Delayed	Draw	Credit	Facilities	may	be	prepaid	at	any	time	without	premium.

The	credit	agreement	contains	usual	and	customary	representations	and	warranties,	and	usual	and	customary	affirmative	and	negative	covenants, including:	financial	covenants	(including	maintenance	of	a	maximum	consolidated	debt	to	capitalization	ratio	and	a	minimum	consolidated	interest	coverage ratio)	and	limitations	on	liens,	additional	subsidiary	indebtedness	and	asset	sales	and	mergers.	The	credit	agreement	also	contains	usual	and	customary events	of	default,	including:	non-payment	of	principal,	interest,	fees	and	other	amounts;	material	breach	of	a	representation	or	warranty;	default	on	other material	debt;	bankruptcy	or	insolvency;	incurrence	of	certain	material	ERISA	liabilities;	material	judgments;	impairment	of	loan	documentation;	change	of control;	and	material	breach	of	obligations	under	securitization	programs.

# Capital	Lease	and	Other	Indebtedness

The	range	of	due	dates	on	our	capital	lease	obligations	are	primarily	in	fiscal	2027	to	2035.	Our	international	debt	is	primarily	in	Europe,	Brazil	and India.

As	of	September	30,	2018,	the	aggregate	maturities	of	debt,	excluding	capital	lease	obligations,	for	the	succeeding	five	fiscal	years	and	thereafter	are as	follows	(in	millions):

| Fiscal	2019 | $726.6 |
| :--- | :--- |
| Fiscal\t2020 | 474.5 |
| Fiscal\t2021 | 350.3 |
| Fiscal\t2022 | 1,000.9 |
| Fiscal\t2023 | 350.1 |
| Thereafter | 3,136.6 |
| Fair\tvalue\tof\tdebt\tstep-up,\tdeferred\tfinancing\tcosts\tand\tunamortized |  |
| \t\t\tbond\tdiscounts | 205.2 |
| Total | $6,244.2 |

As	of	September	30,	2018,	the	aggregate	maturities	of	capital	lease	obligations	for	the	succeeding	five	fiscal	years	and	thereafter	are	as	follows	(in millions):

| Fiscal	2019 | $5.0 |
| :--- | :--- |
| Fiscal\t2020 | 4.2 |
| Fiscal\t2021 | 2.5 |
| Fiscal\t2022 | 2.1 |
| Fiscal\t2023 | 0.6 |
| Thereafter | 138.1 |
| Fair\tvalue\tstep-up | 18.5 |
| Total | $171.0 |

# Note	14. Operating	Leases

We	 lease	 certain	 manufacturing	 and	 warehousing	 facilities	 and	 equipment,	 primarily	 transportation	 equipment,	 and	 office	 space	 under	 various operating	leases.	Some	leases	contain	escalation	clauses	and	provisions	for	lease	renewal.	As	of	September	30,	2018,	future	minimum	lease	payments under	all	noncancelable	operating	leases	for	the	succeeding	five	fiscal	years	and	thereafter	are	as	follows	(in	millions):

| Fiscal	2019 | $132.1 |
| :--- | :--- |
| Fiscal\t2020 | 112.0 |
| Fiscal\t2021 | 87.9 |
| Fiscal\t2022 | 66.8 |
| Fiscal\t2023 | 51.6 |
| Thereafter | 165.4 |
| Total\tfuture\tminimum\tlease\tpayments | $615.8 |

Rental	expense	 for	 the	years	ended	September	30,	2018,	2017	and	2016	was	approximately	$243.7	million,	$210.5	million	and	$199.3	million, respectively,	including	lease	payments	under	cancelable	leases	and	maintenance	charges	on	transportation	equipment.

# Note	15. Special	Purpose	Entities

Pursuant	to	a	sale	of	certain	large-tract	forestlands	in	2007,	a	special	purpose	entity	MWV	Timber	Notes	Holding,	LLC	(" MWV	TN")	received,	and WestRock	assumed	upon	the	Combination,	an	installment	note	receivable	in	the	amount	of	$398.0	million	("Timber	Note").	The	Timber	Note	does	not require	any	principal	payments	until	its	maturity	in	October	2027	and	bears	interest	at	a	rate	approximating	LIBOR.	In	addition,	the	Timber	Note	is	supported by	a	bank-issued	irrevocable	letter	of	credit	obtained	by	the	buyer	of	the	forestlands.	The	Timber	Note	is	not	subject	to	prepayment	in	whole	or	in	part	prior to	maturity.	The	bank's	credit	rating	as	of	October	2018	was	investment	grade.

Using	the	Timber	Note	as	collateral,	MWV	TN	received	$338.3	million	in	proceeds	under	a	secured	financing	agreement	with	a	bank.	Under	the	terms of	the	agreement,	the	liability	from	this	transaction	is	non-recourse	to	the	Company	and	is	payable	from	the	Timber	Note	proceeds	upon	its	maturity	in October	2027.	As	a	result,	the	Timber	Note	is	not	available	to	satisfy	any	obligations	of	WestRock.	MWV	TN	can	elect	to	prepay	at	any	time	the	liability	in whole	or	in	part,	however,	given	that	the	Timber	Note	is	not	prepayable,	MWV	TN	expects	to	only	repay	the	liability	at	maturity	from	the	Timber	Note proceeds.

The	Timber	 Note	 and	 the	 secured	 financing	 liability	 were	 fair	 valued	 on	 the	 opening	 balance	 sheet	 in	 connection	 with	 the	 Combination.	As	 of September	30,	2018,	the	Timber	Note	was	$366.0	million	and	is	included	within	restricted	assets	held	by	special	purpose	entities	on	the	consolidated balance	sheet	and	the	secured	financing	liability	was	$323.1	million	and	is	included	within	non-recourse	liabilities	held	by	special	purpose	entities	on	the consolidated	balance	sheet.

Pursuant	to	the	sale	of	MWV's	remaining	U.S.	forestlands,	which	occurred	on	December	6,	2013,	another	special	purpose	entity	MWV	Timber	Notes Holding	Company	II,	LLC	("MWV	TN	II")	received,	and	WestRock	assumed	upon	the	Combination,	an	installment	note	receivable	in	the	amount	of	$860.0 million	(the	"Installment	Note").	The	Installment	Note	does	not	require	any	principal	payments	until	its	maturity	in	December	2023	and	bears	interest	at	a fixed	rate	of	5.207%.	However,	at	any	time	during	a	180-day	period	following	receipt	by	the	borrower	of	notice	from	us	that	we	intend	to	withhold	our	consent to	any	amendment	or	waiver	of	this	Installment	Note	that	was	requested	by	the	borrower	and	approved	by	any	eligible	assignees,	the	borrower	may	prepay the	Installment	Note	in	whole	but	not	in	part	for	cash	at	100%	of	the	principal,	plus	accrued	but	unpaid	interest,	breakage,	or	other	similar	amount	if	any.	As of	September	30,	2018,	no	event	had	occurred	that	would	allow	for	the	prepayment	of	the	Installment	Note.	We	monitor	the	credit	quality	of	the	borrower and	receive	quarterly	compliance	certificates.	The	borrower's	credit	rating	as	of	October	2018	was	investment	grade.

Using	the	Installment	Note	as	collateral,	MWV	TN	II	received	$774.0	million	in	proceeds	under	a	secured	financing	agreement	with	a	bank.	Under	the terms	of	the	agreement,	the	liability	from	this	transaction	is	non-recourse	to	WestRock	and	is	payable	from	the	Installment	Note	proceeds	upon	its	maturity in	December	2023.	As	a	result,	the	Installment	Note	is	not	available	to	satisfy	any	obligations	of	WestRock.	MWV	TN	II	can	elect	to	prepay,	at	any	time,	the liability	in	whole	or	in	part,	with	sufficient	notice,	but	would	avail	itself	of	this	provision	only	in	the	event	the	Installment	Note	was	prepaid	in	whole	or	in	part. The	secured	financing	agreement	however	requires	a	mandatory	repayment,	up	to	the	amount	of	cash	received,	if	the	Installment	Note	is	prepaid	in	whole or	in	part.

The	Installment	Note	and	the	secured	financing	liability	were	fair	valued	on	the	opening	balance	sheet	in	connection	with	the	Combination.	As	of September	30,	2018,	the	Installment	Note	was	$915.0	million	and	is	included	within	restricted	assets	held	by	special	purpose	entities	on	the	consolidated balance	sheet	and	the	secured	financing	liability	was	$830.6	million	and	is	included	within	non-recourse	liabilities	held	by	special	purpose	entities	on	the consolidated	balance	sheet.

# Note	16. Related	Party	Transactions

We	sell	products	to	affiliated	companies.	Net	sales	to	the	affiliated	companies	for	the	fiscal	years	ended	September	30,	2018,	2017	and	2016	were approximately	$418.8	million,	$423.6	million	and	$346.6	million,

respectively.	Accounts	receivable	due	from	the	affiliated	companies	at	September	30,	2018	and	2017	was	$64.2	million	and	$65.1	million,	respectively,	and was	included	in	accounts	receivable	on	our	consolidated	balance	sheets.

# Note	17. Commitments	and	Contingencies

# Capital	Additions

Estimated	costs	for	future	purchases	of	fixed	assets	that	we	are	obligated	to	purchase	as	of	September	30,	2018,	total	approximately	$203	million.

On	January	31,	2013,	the	EPA	published	Boiler	MACT.	Boiler	MACT	required	compliance	by	January	31,	2016	or	by	January	31,	2017	for	those	mills for	which	we	obtained	a	prior	compliance	extension.	All	work	required	for	our	boilers	to	comply	with	the	rule	has	been	completed.	On	July	29,	2016,	the	U.S. Court	of	Appeals	for	the	District	of	Columbia	Circuit	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	this	decision	will	impact	our	existing	Boiler	MACT	strategies	or	whether	we	will	incur	additional	costs	to	comply	with any	revised	Boiler	MACT	standards.

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.

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	satisfied	by	claims	in	the	Smurfit-Stone	bankruptcy	proceedings.	However,

we	may	face	additional	liability	for	cleanup	activity	at	sites	that	are	not	subject	to	the	bankruptcy	discharge,	but	are	not	currently	identified.	The	final bankruptcy	distributions	were	made	in	fiscal	2018.

As	of	September	30,	2018,	we	had	$10.8	million	reserved	for	environmental	liabilities	on	an	undiscounted	basis,	of	which	$6.7	million	is	included	in other	long-term	liabilities	and	$4.1	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	September	30,	2018.

Certain	jurisdictions	in	which	we	have	manufacturing	facilities	or	other	investments	have	taken	actions	to	address	climate	change.	The	EPA	has issued	 the	Clean	Air	Act	permitting	regulations	applicable	 to	certain	 facilities	 that	emit	GHG.	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	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	 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.	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.	As	directed	by	Executive	Order,	on	April	4,	2017,	the	EPA	issued	a	proposed	rule	announcing	its intention	to	review	the	Clean	Power	Plan,	and,	if	appropriate,	initiate	proceedings	to	suspend,	revise	or	rescind	it.	A	number	of	states	subject	to	the	Clean Power	Plan	have	stopped	working	on	their	implementation	strategies	in	response	to	the	litigation	and	Executive	Order;	however,	certain	states	where	we operate	manufacturing	facilities	have	indicated	their	intention	to	continue	their	carbon	reduction	efforts.	On	August	21,	2018,	the	EPA	proposed	the	ACE rule,	which	would	establish	emission	guidelines	for	states	to	develop	plans	to	address	greenhouse	gas	emissions	from	existing	coal-fired	power	plants.	The ACE	rule	would	replace	the	2015	Clean	Power	Plan,	which	EPA	has	proposed	to	repeal.	The	Clean	Power	Plan	was	stayed	by	the	U.S.	Supreme	Court	and has	never	gone	into	effect.	Although	the	Clean	Power	Plan	and	ACE	rule	do	not	apply	directly	to	the	power	generation	facilities	at	our	mills,	if	either	rule becomes	effective,	it	would	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.	Due	to	ongoing	litigation	and	other	uncertainties	regarding	the	Clean	Power	Plan	and ACE	rule,	their	potential	impacts	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	developing	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.	In	July	2017,	California	extended	the	cap- and-trade	program	to	2030.	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	has	issued	a	final	rule,	known	as	the	Clean	Air	Rule,	which	applies	to	GHGs	from	facilities	that	have	average	annual	carbon	dioxide equivalent	 emissions	 equal	 to	 or	 exceeding	 100,000	 metric	 tons/year.	 Energy	 intensive	 and	 trade	 exposed	 facilities,	 including	 our	Tacoma,	 WA	 and Longview,	WA	(which	we	acquired	through	the	KapStone

Acquisition	(as	hereinafter	defined))	mills,	and	transportation	fuel	importers	are	subject	to	regulation	under	this	program.	In	September	2016,	various	groups filed	lawsuits	against	the	Washington	Department	of	Ecology	challenging	the	Clean	Air	Rule.	In	April	2018,	the	Thurston	County	Superior	Court	invalidated the	Clean	Air	Rule,	and	the	Washington	Department	of	Ecology	subsequently	filed	an	appeal	with	the	State	Supreme	Court.	The	Court	has	not	yet	decided whether	to	grant	the	appeal.	Implementation	of	the	Clean	Air	Rule	has	been	stayed	in	the	meantime.

The	Paris	Agreement	established	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	GHG	reduction	targets.	The	Paris	Agreement	became	effective	on	November	4,	2016.	Although a	party	to	the	agreement	may	not	provide	the	required	one-year	notice	of	withdrawal	until	three	years	after	the	effective	date,	in	June	2017,	President	Trump announced	 that	 the	U.S.	 intended	 to	withdraw	 from	 the	Paris	Agreement.	The	governors	of	New	York,	California's	system	and	Washington's	system subsequently	announced	their	intent	to	form	a	"climate	alliance"	to	coordinate	a	state	response	to	climate	change.	At	this	time,	it	is	not	possible	to	determine how	the	Paris	Agreement,	or	any	potential	U.S.	commitments	in	lieu	of	those	under	the	agreement,	may	impact	U.S.	industrial	facilities,	including	our domestic	operations.

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	and	37.5%	from	1990	levels	by	2030.	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.	The	Province	formally	linked	its	carbon	trading	system	with	California	in	January	2014	and with	Ontario	in	January	2018.	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.

# Litigation

A	lawsuit	filed	in	the	U.S.	District	Court	of	the	Northern	District	of	Illinois	in	2010	alleges	that	certain	named	defendants	violated	the	Sherman	Act	by conspiring	to	limit	the	supply	and	fix	the	prices	of	containerboard	and	products	containing	containerboard	from	February	15,	2004	through	November	8, 2010	(the	"Antitrust	Litigation").	WestRock	CP,	LLC,	as	the	successor	to	Smurfit-Stone,	is	a	named	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.	On	January	9,	2017,	the	defendants	filed	individual	and	joint	Motions	for Summary	Judgment	in	the	District	Court.	On	August	3,	2017,	the	District	Court	granted	our	Motion	for	Summary	Judgment	with	respect	to	all	claims	against us.	The	plaintiffs	have	since	filed	a	notice	of	appeal	and,	on	May	28,	2018,	the	U.S.	Court	of	Appeals	for	the	Seventh	Circuit	heard	oral	arguments	regarding whether	or	not	the	court	should	reverse	the	District	Court's	decision.	We	do	not	expect	the	resolution	of	the	Antitrust	Litigation	to	have	a	material	adverse effect	on	our	results	of	operations,	financial	condition	or	cash	flows.

We	have	been	named	a	defendant	in	asbestos-related	personal	injury	litigation.	To	date,	the	costs	resulting	from	the	litigation,	including	settlement costs,	have	not	been	 significant.	As	 of	 September	30,	 2018,	 there	 were	 approximately	 735	 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	asbestos-related	personal injury	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	do	not	expect	the	resolution	of	pending	asbestos	litigation	and	proceedings	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 adverse	effect	on	our	results	of	operations,	financial	condition	or	cash	flows.

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,	we	believe	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,	for	compliance	with	certain	laws	and	regulations,	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.	We	estimate	the	exposure	for	these	matters could	be	approximately	$50	million.	As	of	September	30,	2018,	we	have	recorded	$11.7	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	laws;	however,	we	believe	our exposure	related	to	guarantees	would	not	have	a	material	impact	on	our	results	of	operations,	financial	condition	or	cash	flows.

# Note	18. Accumulated	Other	Comprehensive	Loss	and	Other	Comprehensive	Income	(Loss)

The	following	table	summarizes	the	changes	in	accumulated	other	comprehensive	loss	by	component	for	the	fiscal	years	ended	September	30,	2018 and	2017	(in	millions):

|  | Deferred<br>Loss	on	Cash<br>Flow	Hedges | Pension	and<br>Postretirement<br>Plans | Foreign<br>Currency<br>Items | Available<br>for	Sale<br>Security | Total<br>(1) |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tSeptember\t30,\t2016 | $(0.2) | $(523.8) | $(102.4) | $— | $(626.4) |
| Other\tcomprehensive\tincome\tbefore |  |  |  |  |  |
| \t\t\treclassifications | — | 22.8 | 80.8 | 0.7 | 104.3 |
| Amounts\treclassified\tfrom\taccumulated\tother |  |  |  |  |  |
| \t\t\tcomprehensive\t(income)\tloss | (0.5) | 35.6 | — | — | 35.1 |
| Sale\tof\tHH&amp;B | — | 2.9 | 26.8 | — | 29.7 |
| Net\tcurrent\tperiod\tother\tcomprehensive |  |  |  |  |  |
| \t\t\tloss\t(income) | (0.5) | 61.3 | 107.6 | 0.7 | 169.1 |
| Balance\tat\tSeptember\t30,\t2017 | $(0.7) | $(462.5) | $5.2 | $0.7 | $(457.3) |
| Other\tcomprehensive\t(loss)\tincome\tbefore |  |  |  |  |  |
| \t\t\treclassifications | — | (18.6) | (234.4) | 0.8 | (252.2) |
| Amounts\treclassified\tfrom\taccumulated\tother |  |  |  |  |  |
| \t\t\tcomprehensive\tloss\t(income) | 0.5 | 15.2 | — | (1.5) | 14.2 |
| Net\tcurrent\tperiod\tother\tcomprehensive |  |  |  |  |  |
| \t\t\tincome\t(loss) | 0.5 | (3.4) | (234.4) | (0.7) | (238.0) |
| Balance\tat\tSeptember\t30,\t2018 | $(0.2) | $(465.9) | $(229.2) | $— | $(695.3) |

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

The	 following	 table	 summarizes	 the reclassifications	 out	 of	 accumulated	 other	 comprehensive loss	 by	 component for the fiscal	 years	 ended September	30,	2018	and	2017	(in	millions):

|  | Pre-Tax | 2018<br>Tax | Net	of	Tax | Pre-Tax | 2017<br>Tax | Net	of	Tax |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Amortization\tof\tdefined\tbenefit\tpension\tand |  |  |  |  |  |  |
| \t\t\tpostretirement\titems:\t(1) |  |  |  |  |  |  |
| Actuarial\tgains\t(losses)\t(2) | \t $20.9 | (5.9) | \t $15.0 | \t $(56.3) | \t $20.4 | \t $(35.9) |
| Prior\tservice\tcredits\t(2) | 0.3 | (0.1) | 0.2 | 0.5 | (0.2) | 0.3 |
| Sale\tof\tHH&amp;B\t(3) | — | — | — | (4.2) | 1.3 | (2.9) |
| Subtotal\tdefined\tbenefit\tplans | 21.2 | (6.0) | 15.2 | (60.0) | 21.5 | (38.5) |
| Foreign\tcurrency\ttranslation\tadjustments:\t (1) |  |  |  |  |  |  |
| Sale\tof\tHH&amp;B\t(3) | — | — | — | (26.8) | — | (26.8) |
| Available\tfor\tsale\tsecurity\t (4) | (1.5) | — | (1.5) | — | — | — |
| Derivative\tInstruments:\t(1) |  |  |  |  |  |  |
| Foreign\tcurrency\tcash\tflow\thedges\t(4) | 0.7 | (0.2) | 0.5 | 0.8 | (0.3) | 0.5 |
| Total\treclassifications\tfor\tthe\tperiod | \t $20.4 | \t $(6.2) | \t $14.2 | \t $(86.0) | \t $21.2 | \t $(64.8) |

(1) Amounts	in	parentheses	indicate	charges	to	earnings.	Amounts	pertaining	to	noncontrolling	interests	are	excluded.

(2) These	accumulated	other	comprehensive	income	components	are	included	in	the	computation	of	net	periodic	pension	cost.	See	"Note	4.	Retirement	Plans"	for additional	details.

(3) Included	in	gain	on	sale	of	HH&B.

(4) These	accumulated	other	comprehensive	income	components	are	included	in	net	sales.

A	summary	of	the	components	of	other	comprehensive	(loss)	income,	including	noncontrolling	interest,	for	the	years	ended	September	30,	2018,	2017 and	2016,	is	as	follows	(in	millions):

| Fiscal	2018 | Pre-Tax | Tax | Net	of	Tax |
| :--- | :--- | :--- | :--- |
| Foreign\tcurrency\ttranslation\tloss | $(234.4) | $— | $(234.4) |
| Reclassification\tadjustment\tof\tnet\tloss\ton\tcash\tflow\thedges |  |  |  |
| \t\t\tincluded\tin\tearnings | 0.7 | (0.2) | 0.5 |
| Net\tactuarial\tloss\tarising\tduring\tperiod | (29.0) | 15.9 | (13.1) |
| Amortization\tand\tsettlement\trecognition\tof\tnet\tactuarial\tloss | 20.9 | (5.9) | 15.0 |
| Prior\tservice\tcost\tarising\tduring\tthe\tperiod | (7.8) | 2.3 | (5.5) |
| Amortization\tof\tprior\tservice\tcost | 0.3 | (0.1) | 0.2 |
| Unrealized\tgain\ton\tavailable\tfor\tsale\tsecurity | 0.8 | — | 0.8 |
| Reclassification\tadjustment\tof\tnet\tgain\ton\tavailable\tfor\tsale |  |  |  |
| \t\t\tsecurity\tincluded\tin\tearnings | (1.5) | — | (1.5) |
| Consolidated\tother\tcomprehensive\tloss | (250.0) | 12.0 | (238.0) |
| Less:\tOther\tcomprehensive\tincome\tattributable\tto\tnoncontrolling |  |  |  |
| \t\t\tinterests | — | — | — |
| Other\tcomprehensive\tloss\tattributable\tto\tcommon\n\t\t\tstockholders | $(250.0) | $12.0 | $(238.0) |

| Fiscal	2017 | Pre-Tax | Tax | Net	of	Tax |
| :--- | :--- | :--- | :--- |
| Foreign\tcurrency\ttranslation\tgain | $80.7 | $— | $80.7 |
| Sale\tof\tHH&amp;B,\tforeign\tcurrency | 26.8 | — | 26.8 |
| Reclassification\tadjustment\tof\tnet\tgain\ton\tcash\tflow\thedges |  |  |  |
| \t\t\tincluded\tin\tearnings | (0.8) | 0.3 | (0.5) |
| Net\tactuarial\tgain\tarising\tduring\tperiod | 34.1 | (11.9) | 22.2 |
| Amortization\tand\tsettlement\trecognition\tof\tnet\tactuarial\tloss | 56.4 | (20.4) | 36.0 |
| Prior\tservice\tcredit\tarising\tduring\tthe\tperiod | 1.0 | (0.3) | 0.7 |
| Amortization\tof\tprior\tservice\tcredit | (0.4) | 0.2 | (0.2) |
| Unrealized\tgain\ton\tavailable\tfor\tsale\tsecurity | 0.7 | — | 0.7 |
| Sale\tof\tHH&amp;B,\tdefined\tbenefit\tpension\tplans | 4.2 | (1.3) | 2.9 |
| Consolidated\tother\tcomprehensive\tincome | 202.7 | (33.4) | 169.3 |
| Less:\tOther\tcomprehensive\tincome\tattributable\tto\tnoncontrolling |  |  |  |
| \t\t\tinterests | (0.2) | — | (0.2) |
| Other\tcomprehensive\tincome\tattributable\tto\tcommon |  |  |  |
| \t\t\tstockholders | $202.5 | $(33.4) | $169.1 |

| Fiscal	2016 | Pre-Tax | Tax | Net	of	Tax |
| :--- | :--- | :--- | :--- |
| Foreign\tcurrency\ttranslation\tgain | $109.8 | $— | $109.8 |
| Deferred\tloss\ton\tcash\tflow\thedges | (0.7) | 0.3 | (0.4) |
| Reclassification\tadjustment\tof\tnet\tloss\ton\tcash\tflow\thedges |  |  |  |
| \t\t\tincluded\tin\tearnings | 1.9 | (0.7) | 1.2 |
| Net\tactuarial\tloss\tarising\tduring\tperiod | (354.0) | 129.4 | (224.6) |
| Amortization\tand\tsettlement\trecognition\tof\tnet\tactuarial\tloss \t(1) | 379.7 | (143.2) | 236.5 |
| Prior\tservice\tcredit\tarising\tduring\tthe\tperiod | 2.3 | (0.9) | 1.4 |
| Amortization\tof\tprior\tservice\tcost | 1.8 | (0.7) | 1.1 |
| Sale\tof\tforeign\tsubsidiary | 20.2 | — | 20.2 |
| Consolidated\tother\tcomprehensive\tincome | 161.0 | (15.8) | 145.2 |
| Less:\tOther\tcomprehensive\tloss\tattributable\tto\tnoncontrolling |  |  |  |
| \t\t\tinterests | 0.7 | — | 0.7 |
| Other\tcomprehensive\tincome\tattributable\tto\tcommon |  |  |  |
| \t\t\tstockholders | $161.7 | $(15.8) | $145.9 |
| (1)\nIncludes\tpension\trisk\ttransfer\texpense. |  |  |  |

(1) Includes	pension	risk	transfer	expense.

# Note	19. Stockholders'	Equity

# Capitalization

Our	capital	stock	consists	solely	of	Common	Stock.	Holders	of	our	Common	Stock	are	entitled	to	one	vote	per	share.	Our	amended	and	restated certificate	 of	 incorporation	 also	 authorizes	 preferred	 stock,	 of	 which	 no	 shares	 have	 been	 issued.	 The	 terms	 and	 provisions	 of	 such	 shares	 will	 be determined	by	our	board	of	directors	upon	any	issuance	of	such	shares	in	accordance	with	our	certificate	of	incorporation.

In	July	2015,	our	board	of	directors	authorized	a	repurchase	program	of	up	to	40.0	million	shares	of	our	Common	Stock,	representing	approximately 15%	of	our	outstanding	Common	Stock	as	of	July	1,	2015.	The	shares	of	our	Common	Stock	may	be	repurchased	over	an	indefinite	period	of	time	at	the discretion	of	management.	In	fiscal	2018,	we	repurchased	approximately	3.4	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$195.1	million.	In fiscal	2017,	we	repurchased	approximately	1.8	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$93.0	million.	In	fiscal	2016,	we	repurchased approximately	8.1	million	shares	of	our	Common	Stock	for	an	aggregate	cost	of	$335.3	million.	As	of	September	30,	2018,	we	had	remaining	authorization under	the	repurchase	program	authorized	in	July	2015	to	purchase	approximately	21.3	million	shares	of	our	Common	Stock.

# Note	20. Share-Based	Compensation

# Share-based	Compensation	Plans

At	our	Annual	Meeting	of	Stockholders	held	on	February	2,	2016,	our	stockholders	approved	the	WestRock	Company	2016	Incentive	Stock	Plan.	The 2016	Incentive	Stock	Plan	was	amended	and	restated	on	February	2,	2018	(the	"Amended	and	Restated	2016	Incentive	Stock	Plan").	The	Amended	and Restated	2016	Incentive	Stock	Plan	allows	for	the	granting	of	options,	restricted	stock,	SARs	and	restricted	stock	units	to	certain	key	employees	and directors.

The	table	below	shows	the	approximate	number	of	shares:	available	for	issuance,	available	for	future	grant,	to	be	issued	if	restricted	awards	granted with	a	performance	condition	recorded	at	target	achieve	the	maximum	award,	and	if	new	grants	pursuant	to	the	plan	are	expected	to	be	issued,	each	as adjusted	as	necessary	for	corporate	actions	(in	millions).

|  | Shares<br>Available	For<br>Issuance | Shares<br>Available	For<br>Future	Grant | Issued	If<br>Performance	Is<br>Achieved	At<br>Maximum | Expect	To<br>Make	New<br>Awards |
| :--- | :--- | :--- | :--- | :--- |
| (1)\nAmended\tand\tRestated\t2016\tIncentive\tStock\tPlan | 11.7 | 8.0 | 2.5 | Yes |
| 2004\tIncentive\tStock\tPlan\t(1)(2) | 15.8 | 3.1 | 0.0 | No |
| 2005\tPerformance\tIncentive\tPlan\t(1)(2) | 12.8 | 9.0 | 0.0 | No |
| RockTenn\t(SSCC)\tEquity\tInventive\tPlan\t(1)(3) | 7.9 | 5.9 | 0.0 | No |

(1) 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.

(2) In	connection	with	the	Combination,	WestRock	assumed	all	RockTenn	and	MWV	equity	incentive	plans.	We	issued	awards	to	certain	key	employees	and	our directors	pursuant	to	our	RockTenn	2004	Incentive	Stock	Plan,	as	amended,	and	our	MWV	2005	Performance	Incentive	Plan,	as	amended.	The	awards were	converted	into	WestRock	awards	using	the	conversion	factor	as	described	in	Business	Combination	Agreement.

(3) In	connection	with	the	Smurfit-Stone	Acquisition,	we	assumed	the	Smurfit-Stone	equity	incentive	plan,	which	was	renamed	the	Rock-Tenn	Company	(SSCC) Equity	Incentive	Plan.	The	awards	were	converted	into	shares	of	RockTenn	Common	Stock,	options	and	restricted	stock	units,	as	applicable,	using	the conversion	factor	as	described	in	the	merger	agreement.

Our	results	of	operations	for	the	fiscal	years	ended	September	30,	2018,	2017	and	2016	include	share-based	compensation	expense	of	$66.8	million, $60.9	million	and	$75.7	million,	respectively,	including	$2.9	million	included	in	the	gain	on	sale	of	HH&B	in	fiscal	2017.	Share-based	compensation	expense in	fiscal	2017	was	reduced	by	$5.4	million	for	the	rescission	of	shares	granted	to	our	CEO	that	were	inadvertently	granted	in	excess	of	plan	limits	in	fiscal 2014	and	2015.	The	total	income	tax	benefit	in	the	results	of	operations	in	connection	with	share-based	compensation	was	$19.4	million,	$22.5	million	and $29.2	million,	for	the	fiscal	years	ended	September	30,	2018,	2017	and	2016,	respectively.

Cash	received	from	share-based	payment	arrangements	for	the	fiscal	years	ended	September	30,	2018,	2017	and	2016	was	$44.4	million,	$59.2 million	and	$33.9	million,	respectively.

# Equity	Awards	Issued	in	Connection	with	the	MPS	Acquisition

In	connection	with	the	MPS	Acquisition,	we	replaced	certain	outstanding	awards	of	restricted	stock	units	granted	under	the	MPS	long-term	incentive plan	with	WestRock	restricted	stock	units.	No	additional	shares	will	be	granted	under	the	MPS	plan.	The	MPS	equity	awards	were	replaced	with	identical terms	utilizing	an	approximately	0.33	conversion	factor	as	described	in	the	merger	agreement.	As	part	of	the	MPS	Acquisition,	we	granted	119,373

awards	 of	 restricted	 stock	 units,	 which	 contain	 service	 conditions	 and	 were	 valued	 at	 $54.24	 per	 share.	 The	 acquisition	 consideration	 included approximately	$1.9	million	related	to	outstanding	MPS	equity	awards	related	to	service	prior	to	the	effective	date	of	the	MPS	Acquisition	–	the	balance related	to	service	after	the	effective	date	will	be	expensed	over	the	remaining	service	period	of	the	awards.

# Stock	Options	and	Stock	Appreciation	Rights

Stock	options	granted	under	our	plans	generally	have	an	exercise	price	equal	to	the	closing	market	price	on	the	date	of	the	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.	Presently,	other	than	circumstances	such	as	death,	disability	and	retirement,	grants will	include	a	provision	requiring	both	a	change	of	control	and	termination	of	employment	to	accelerate	vesting.

At	the	date	of	grant,	we	estimate	the	fair	value	of	stock	options	granted	using	a	Black-Scholes	option	pricing	model.	We	use	historical	data	to	estimate option	exercises	and	employee	terminations	in	determining	the	expected	term	in	years	for	stock	options.	Expected	volatility	is	calculated	based	on	the historical	volatility	of	our	stock,	or	a	combination	of	the	historical	volatility	of	both	RockTenn	and	MWV	grants.	The	risk-free	interest	rate	is	based	on	U.S. Treasury	securities	in	effect	at	the	date	of	the	grant	of	the	stock	options.	The	dividend	yield	is	estimated	based	on	our	historic	annual	dividend	payments and	current	expectations	for	the	future.	We	did	not	grant	any	stock	options	in	fiscal	2018	and	2017.

We	applied	the	following	weighted	average	assumptions	to	estimate	the	fair	value	of	stock	option	grants	made	in	the	following	period:

|  | 2016 |
| :--- | :--- |
| Expected\tterm\tin\tyears | 7.0 |
| Expected\tvolatility | 38.3% |
| Risk-free\tinterest\trate | 1.6% |
| Dividend\tyield | 4.5% |

The	table	below	summarizes	the	changes	in	all	stock	options	during	the	fiscal	year	ended	September	30,	2018:

|  | Stock<br>Options | Weighted<br>Average<br>Exercise<br>Price | Remaining<br>Contractual<br>Term<br>(in	years) | Aggregate<br>Intrinsic<br>Value<br>(in	millions) |
| :--- | :--- | :--- | :--- | :--- |
| Outstanding\tat\tSeptember\t30,\t2017 | 5,866,127 | $30.51 |  |  |
| Exercised | (1,582,313) | 21.73 |  |  |
| Expired | (5,819) | 37.17 |  |  |
| Forfeited | (24,341) | 32.13 |  |  |
| Outstanding\tat\tSeptember\t30,\t2018 | 4,253,654 | $33.75 | 4.3 | $85.8 |
| Exercisable\tat\tSeptember\t30,\t2018 | 3,845,523 | $34.17 | 4.0 | $76.1 |
| Vested\tand\texpected\tto\tvest\tat\tSeptember\t30,\t2018 | 4,251,748 | $33.75 | 4.3 | $85.7 |

As	of	September	30,	2018,	there	was	$0.4	million	of	total	unrecognized	compensation	cost	related	to	nonvested	stock	options;	that	cost	is	expected	to be	recognized	over	a	weighted	average	remaining	vesting	period	of	0.3	years.	We	amortize	these	costs	on	a	straight-line	basis	over	the	explicit	service period.

As	part	of	the	Combination,	we	issued	SARs	to	replace	outstanding	MWV	SARs.	The	SARs	were	valued	using	the	Black-Scholes	option	pricing model.	We	measure	compensation	expense	related	to	the	SAR	awards	at	the	end	of	each	period.	We	do	not	expect	to	issue	additional	SARs.

The	table	below	summarizes	the	changes	in	all	SARs	during	the	fiscal	year	ended	September	30,	2018:

|  |  |  | Weighted |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | Average |  |  |
|  | SARs | Weighted\nAverage\nExercise\nPrice | Remaining\nContractual\nTerm\n(in\tyears) |  | Aggregate\nIntrinsic\nValue\n(in\tmillions) |
| Outstanding\tat\tSeptember\t30,\t2017 | 51,016 | $25.30 |  |  |  |
| Exercised | (9,935) | 16.66 |  |  |  |
| Expired | (4,095) | 27.69 |  |  |  |
| Outstanding\tat\tSeptember\t30,\t2018 | 36,986 | $27.36 |  | 2.4 | $1.0 |
| Exercisable\tat\tSeptember\t30,\t2018 | 36,986 | $27.36 |  | 2.4 | $1.0 |

The	aggregate	intrinsic	value	of	SARs	exercised	during	the	years	ended	September	30,	2018,	2017	and	2016	was	$0.5	million,	$0.4	million	and	$0.2 million,	respectively.

# Restricted	Stock

Restricted	stock	is	typically	granted	annually	to	non-employee	directors	and	certain	of	our	employees.	Our	non-employee	director	awards	generally vest	over	a	period	of	up	to	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	including, but	not	limited	to,	achievement	of	various	financial	targets	including	Cash	Flow	Per	Share,	Cash	Flow	to	Equity	Ratio	and	relative	Total	Shareholder	Return (each	as	defined	in	the	award	documents).	Subject	to	the	level	of	performance	attained,	the	target	award	for	some	of	the	grants	may	increase	up	to	200%	of target	or	decrease	to	zero	depending	upon	the	terms	of	the	individual	grant.	The	employee	grants	generally	vest	in	three	years.	Presently,	other	than circumstances	such	as	death,	disability	and	retirement,	the	grants	generally	include	a	provision	requiring	both	a	change	of	control	and	termination	of employment	to	accelerate	vesting.	For	certain	employee	grants,	the	grantee	is	entitled	to	receive	dividend	equivalent	units,	but	will	generally	forfeit	the restricted	 award	 and	 the	 dividend	 equivalents	 if	 the	 employee	 separates	 from	 us	 during	 the	 vesting	 period	 or	 if	 the	 predetermined	 goals	 are	 not accomplished.

The	table	below	summarizes	the	changes	in	unvested	restricted	stock	during	the	fiscal	year	ended	September	30,	2018:

|  |  | Shares/Units | Value |
| :--- | :--- | :--- | :--- |
| Unvested\tat\tSeptember\t30,\t2017 | (1) | 2,959,449 | $45.28 |
| Granted | Granted | 1,116,111 | 69.36 |
| Vested | Vested | (697,717) | 57.39 |
| Forfeited | Forfeited | (153,669) | 45.07 |
| Unvested\tat\tSeptember\t30,\t2018 | (1) | 3,224,174 | $51.01 |

(1) Target	awards	granted	with	a	performance	condition,	net	of	subsequent	forfeitures,	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	0.9	million	additional	shares.	However,	it	is possible	that	the	performance	attained	may	vary.

There	was	approximately	$83.5	million	of	unrecognized	compensation	cost	related	to	all	unvested	restricted	shares	as	of	September	30,	2018	that	will be	recognized	over	a	weighted	average	remaining	vesting	period	of	1.3	years.

The	following	table	represents	a	summary	of	restricted	stock	shares	granted	in	fiscal	2018,	2017	and	2016	with	terms	defined	in	the	applicable	grant letters.	The	shares	are	not	deemed	to	be	issued	and	carry	voting	rights	until	the	relevant	conditions	defined	in	the	award	documents	have	been	met,	unless otherwise	noted.

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| (1)\nShares\tof\trestricted\tstock\tgranted\tto\tnon-employee\tdirectors | 23,285 | 26,521 | 64,155 |
| Shares\tof\trestricted\tstock\tgranted\tto\temployees: |  |  |  |
| Shares\tgranted\tfor\tattainment\tof\ta\tperformance\tcondition\tat |  |  |  |
| \t\t\tan\tamount\tin\texcess\tof\ttarget\t(2) | 45,964 | 340,319 | 447,261 |
| Shares\tgranted\twith\ta\tservice\tcondition\tand\ta\tCash\tFlow\tPer |  |  |  |
| (3)\t(4)\n\t\t\tShare\tperformance\tcondition\tat\ttarget | 432,655 | 507,070 | 1,211,760 |
| Shares\tgranted\twith\ta\tservice\tcondition\tand\ta\trelative\tTotal |  |  |  |
| (3)\n\t\t\tShareholder\tReturn\tmarket\tcondition\tat\ttarget | 259,695 | 301,980 | — |
| Shares\tgranted\twith\ta\tservice\tcondition\t(5) | 354,512 | 309,850 | 27,370 |
| Share\tof\trestricted\tstock\tassumed\tin\tpurchase\taccounting: |  |  |  |
| Shares\tgranted\twith\ta\tservice\tcondition\t(6) | — | 119,373 | — |
| Total\trestricted\tstock\tgranted | 1,116,111 | 1,605,113 | 1,750,546 |

(1) Non-employee	director	grants	generally	vest	over	a	period	of	up	to	one	year	and	are	deemed	issued	on	the	grant	date	and	have	voting	and	dividend	rights.

(2) Shares	granted	in	the	table	above	include	shares	subsequently	issued	for	the	level	of	performance	attained	in	excess	of	target.	Shares	issued	in	fiscal	2018	for	the fiscal	2015	Cash	Flow	Per	Share	were	at	103.7%	of	target.	Shares	issued	in	fiscal	2017	for	the	fiscal	2014	Cash	Flow	Per	Share	were	at	176.6%	of	target.	Shares issued	in	fiscal	2016	for	the	fiscal	2013	Cash	Flow	to	Equity	Ratio	were	at	200%	of	target.	Shares	issued	in	fiscal	2017	and	2016	also	include	shares	accelerated for	terminated	employees	primarily	as	a	result	of	the	Combination,	which	were	achieved	at	between	146.5%	and	200%	of	target.

(3) These	employee	grants	vest	over	approximately	three	years	and	have	adjustable	ranges	from	0	-	200%	of	target	subject	to	the	level	of	performance	attained	in	the respective	award	agreement.	The	employee	grants	with	a	relative	Total	Shareholder	Return	condition	were	valued	using	a	Monte	Carlo	simulation,	the	terms	of which	are	outlined	below.

(4) Shares	granted	in	fiscal	2015	were	reduced	by	50,326	shares	at	target	related	to	the	rescission	of	shares	granted	to	our	CEO	that	were	inadvertently	granted	in excess	of	plan	limits.

(5) These	shares	vest	over	approximately	three	to	four	years.

(6) These	shares	vest	over	approximately	one	to	three	years.

The	employee	grants	with	a	relative	Total	Shareholder	Return	market	condition	in	fiscal	2018	were	valued	using	a	Monte	Carlo	simulation	at	$66.28 per	share.	The	significant	assumptions	used	in	valuing	these	grants	included:	an	expected	term	of	2.9	years,	an	expected	volatility	of	29.7%	and	a	risk-free interest	rate	of	2.3%.	We	amortize	these	costs	on	a	straight-line	basis	over	the	explicit	service	period.

The	employee	grants	with	a	relative	Total	Shareholder	Return	market	condition	in	fiscal	2017	were	valued	using	a	Monte	Carlo	simulation	at	$64.41 per	share.	The	significant	assumptions	used	in	valuing	these	grants	included:	an	expected	term	of	2.9	years,	an	expected	volatility	of	30.6%	and	a	risk-free interest	rate	of	1.4%.	We	amortize	these	costs	on	a	straight-line	basis	over	the	explicit	service	period.

Expense	is	recognized	on	restricted	stock	grants	on	a	straight-line	basis	over	the	explicit	service	period	or	for	performance	based	grants	over	the explicit	service	period	when	we	estimate	that	it	is	probable	the	performance	conditions	will	be	satisfied.	Expense	recognized	on	grants	with	a	performance condition	that	affects	how	many	shares	are	ultimately	awarded	is	based	on	the	number	of	shares	expected	to	be	awarded.

The	following	table	represents	a	summary	of	restricted	stock	vested	in	fiscal	2018,	2017	and	2016	(in	millions,	except	shares):

|  | 2018 | 2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Shares\tof\trestricted\tstock\tvested | 697,717 | 1,112,909 | 1,589,761 |
| Aggregate\tfair\tvalue\tof\trestricted\tstock\tvested | $46.1 | $59.5 | $57.5 |

The	shares	vested	in	fiscal	2018	reflect	the	vesting	of	the	fiscal	2015	grants,	with	a	Cash	Flow	Per	Share	performance	condition	that	vested	at	103.7% of	target,	as	well	as	certain	shares	with	a	performance	and/or	service	condition,	including	those	shares	assumed	upon	the	Combination.	The	shares	vested in	2017	reflect	the	vesting	of	the	fiscal	2014	grant,	with	a	Cash	Flow	Per	Share	performance	condition	that	vested	at	176.6%	of	target,	certain	shares assumed	upon	the	Combination	with	a	performance	and/or	service	condition,	as	well	as	other	awards	accelerated	in	connection	with	the	Combination	for certain	former	employees.	The	shares	vested	in	2016	reflect	the	vesting	of	the	fiscal	2013	grant,	with	a	cash	flow	to	equity	ratio	performance	condition	that vested	at	maximum,	certain	shares	assumed	upon	the	Combination	with	a	performance	and/or	service	condition,	as	well	as	other	awards	accelerated	in connection	with	the	Combination	for	certain	former	employees.

# Employee	Stock	Purchase	Plan

At	our	Annual	Meeting	of	Stockholders	held	on	February	2,	2016,	our	stockholders	approved	the	WestRock	Company	Employee	Stock	Purchase	Plan ("ESPP").	Under	the	ESPP,	shares	of	Common	Stock	are	reserved	for	purchase	by	our	qualifying	employees.	The	ESPP	allowed	for	the	purchase	of	a	total of	approximately	2.5	million	shares	of	Common	Stock.	During	fiscal	2018,	2017	and	2016,	including	shares	purchased	under	the	then	existing	RockTenn Employee	Stock	Purchase	Plan,	employees	purchased	approximately	0.2	million,	0.2	million	and	0.1	million	shares,	respectively,	under	the	ESPP.	We recognized	$1.6	million,	$1.3	million	and	$0.4	million	of	expense	for	fiscal	2018,	2017	and	2016,	respectively,	related	to	the	15%	discount	on	the	purchase price	allowed	to	employees.	As	of	September	30,	2018,	adjusted	for	the	Separation,	approximately	2.4	million	shares	of	Common	Stock	remained	available for	purchase	under	the	ESPP.

# Note	21. Earnings	per	Share

Restricted	stock	awards	we	grant	to	non-employee	directors	are	considered	participating	securities	as	they	receive	non-forfeitable	rights	to	dividends	at the	same	rate	as	our	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):

|  | 2018 | September	30,<br>2017 | 2016 |
| :--- | :--- | :--- | :--- |
| Numerator: |  |  |  |
| Income\tfrom\tcontinuing\toperations | $1,909.3 | $698.6 | $154.8 |
| Less:\tNet\t(income)\tloss\tfrom\tcontinuing\toperations\tattributable |  |  |  |
| \t\t\tto\tnoncontrolling\tinterest | (3.2) | 9.6 | (2.1) |
| Income\tavailable\tto\tcommon\tstockholders,\tbefore\tdiscontinued |  |  |  |
| \t\t\toperations | 1,906.1 | 708.2 | 152.7 |
| Less:\tDistributed\tand\tundistributed\tincome\tavailable\tto |  |  |  |
| \t\t\tparticipating\tsecurities | (0.2) | (0.1) | — |
| Distributed\tand\tundistributed\tincome\tattributable\tto\tcommon |  |  |  |
| \t\t\tstockholders,\tbefore\tdiscontinued\toperations | 1,905.9 | 708.1 | 152.7 |
| Loss\tfrom\tdiscontinued\toperations\t(1) | — | — | (549.0) |
| Net\tincome\t(loss)\tattributable\tto\tcommon\tstockholders | $1,905.9 | $708.1 | $(396.3) |
| Denominator: |  |  |  |
| Basic\tweighted\taverage\tshares\toutstanding | 255.5 | 252.2 | 254.0 |
| Effect\tof\tdilutive\tstock\toptions\tand\tnon-participating\tsecurities | 4.3 | 3.5 | 3.9 |
| Diluted\tweighted\taverage\tshares\toutstanding | 259.8 | 255.7 | 257.9 |
| Basic\tearnings\tper\tshare\tfrom\tcontinuing\toperations | $7.46 | $2.81 | $0.60 |
| Basic\tloss\tper\tshare\tfrom\tdiscontinued\toperations | — | — | (2.16) |
| Basic\tearnings\t(loss)\tper\tshare\tattributable\tto\tcommon |  |  |  |
| \t\t\tstockholders | $7.46 | $2.81 | $(1.56) |
| Diluted\tearnings\tper\tshare\tfrom\tcontinuing\toperations | $7.34 | $2.77 | $0.59 |
| Diluted\tloss\tper\tshare\tfrom\tdiscontinued\toperations | — | — | (2.13) |
| Diluted\tearnings\t(loss)\tper\tshare\tattributable\tto\tcommon\n\t\t\tstockholders | $7.34 | $2.77 | $(1.54) |

(1) Net	of	income	attributable	to	noncontrolling	interests	of	discontinued	operations	of	$4.3	million	for	the	fiscal	year	ended	September	30,	2016.

Weighted	average	shares	include	zero,	0.2	million	and	0.3	million	of	reserved,	but	unissued	shares	at	September	30,	2018,	2017	and	2016.	These reserved	shares	were	distributed	as	claims	were	liquidated	or	resolved	in	accordance	with	the	resolution	of	Smurfit-Stone	bankruptcy	claims.	The	final bankruptcy	distributions	were	made	in	fiscal	2018.

Options	and	restricted	stock	in	the	amount	of	0.2	million,	0.7	million	and	1.6	million	common	shares	in	fiscal	2018,	2017	and	2016,	respectively,	were not	 included	 in	 computing	 diluted	 earnings	 per	 share	 because	 the	 effect	 would	 have	 been	 antidilutive.	 The	 dilutive	 impact	 of	 the	 remaining	 awards outstanding	in	each	year	were	included	in	the	effect	of	dilutive	securities.

# Note	22. Financial	Results	by	Quarter	(Unaudited)

| Fiscal	2018 | First<br>Quarter | Second<br>Quarter | Third<br>Quarter | Fourth<br>Quarter |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (In\tmillions,\texcept\tper\tshare\tdata) | (In\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tsales | $3,894.0 | $4,017.0 | $4,137.5 | $4,236.6 |
| Cost\tof\tgoods\tsold | $3,111.6 | $3,220.4 | $3,264.3 | $3,294.9 |
| Multiemployer\tpension\twithdrawals | $180.0 | $— | $4.2 | $— |
| Land\tand\tDevelopment\timpairments | $27.6 | $— | $1.7 | $2.6 |
| Restructuring\tand\tother\tcosts | $16.3 | $31.7 | $17.1 | $40.3 |
| (Loss)\tgain\ton\textinguishment\tof\tdebt | $(1.0) | $0.1 | $0.9 | $(0.1) |
| Income\ttax\tbenefit\t(expense) | $1,073.2 | $(18.8) | $(84.5) | $(95.4) |
| Consolidated\tnet\tincome | $1,133.5 | $224.5 | $271.3 | $280.0 |
| Net\tincome\tattributable\tto\tcommon\tstockholders | $1,135.1 | $223.2 | $268.2 | $279.6 |
| Basic\tearnings\tper\tshare\tattributable\tto\tcommon |  |  |  |  |
| \t\t\tstockholders | $4.45 | $0.87 | $1.05 | $1.10 |
| Diluted\tearnings\tper\tshare\tattributable\tto\tcommon |  |  |  |  |
| \t\t\tstockholders | $4.38 | $0.86 | $1.03 | $1.08 |

|  | First | Second | Third | Fourth |
| :--- | :--- | :--- | :--- | :--- |
| Fiscal\t2017 | Quarter | Quarter | Quarter | Quarter |
|  |  | (In\tmillions,\texcept\tper\tshare\tdata) | (In\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tsales | $3,447.2 | $3,656.3 | $3,695.6 | $4,060.6 |
| Cost\tof\tgoods\tsold | $2,855.9 | $2,980.9 | $3,000.1 | $3,282.6 |
| Pension\tlump\tsum\tsettlement | $— | $28.7 | $— | $3.9 |
| Land\tand\tDevelopment\timpairments | $— | $42.7 | $— | $4.0 |
| Restructuring\tand\tother\tcosts | $81.0 | $18.3 | $59.4 | $38.0 |
| (Loss)\tgain\ton\textinguishment\tof\tdebt | $— | $(0.1) | $2.0 | $(0.1) |
| Gain\ton\tsale\tof\tHH&amp;B | $— | $— | $190.6 | $2.2 |
| Consolidated\tnet\tincome | $78.5 | $98.2 | $326.6 | $195.3 |
| Net\tincome\tattributable\tto\tcommon\tstockholders | $80.9 | $103.1 | $328.1 | $196.1 |
| Basic\tearnings\tper\tshare\tattributable\tto\tcommon |  |  |  |  |
| \t\t\tstockholders | $0.32 | $0.41 | $1.30 | $0.77 |
| Diluted\tearnings\tper\tshare\tattributable\tto\tcommon |  |  |  |  |
| \t\t\tstockholders | $0.32 | $0.40 | $1.29 | $0.76 |

We	computed	the	interim	earnings	per	common	and	common	equivalent	share	amounts	as	if	each	quarter	was	a	discrete	period.	As	a	result,	the	sum of	the	basic	and	diluted	earnings	per	share	by	quarter	will	not	necessarily	total	the	annual	basic	and	diluted	earnings	per	share.

Consolidated	net	income	in	the	first	quarter	of	fiscal	2018	financial	results	by	quarter	(unaudited)	table	was	decreased	as	the	result	of	recording	an estimated	multiemployer	pension	withdrawal	of	$180.0	million,	or	$179.1	million	net	of	noncontrolling	interest,	to	withdraw	from	a	multiemployer	pension plan.	See	"Note	4.	Retirement	Plans	—	Multiemployer	Plans ".	Additionally,	consolidated	net	income	in	the	first	quarter	of	fiscal	2018	financial	results	by quarter	(unaudited)	table	was	decreased	due	to	a	$27.6	million,	or	$25.6	million	net	of	noncontrolling	interest,	pre-tax	non-cash	impairment	of	certain mineral	rights	and	real	estate.	Further,	consolidated	net	income	in	the	first	quarter	of	fiscal	2018	financial	results	by	quarter	(unaudited)	table	was	increased by	$1,086.9	million	for	the	provisional	amount	recorded	for	the	measurement	of	our	deferred	tax	balances	in	connection	with	the	Tax	Act.	See	"Note	5. Income	Taxes".	Basic	and	diluted	earnings	per	share	attributable	to	common	stockholders	were	increased	by	approximately	$3.67	and	$3.61	per	share, respectively	for	these	items.

Consolidated	net	income	in	the	second	quarter	of	fiscal	2018	financial	results	by	quarter	(unaudited)	table	increased	by	$36.3	million	related	to	an adjustment	to	the	provisional	amount	previously	recorded	for	the	measurement	of	our	deferred	tax	balances	in	connection	with	the	Tax	Act.	Basic	and diluted	earnings	per	share	attributable	to	common	stockholders	were	each	increased	by	$0.14	per	share.

Consolidated	net	income	in	the	first	quarter	of	fiscal	2017	financial	results	by	quarter	(unaudited)	table	was	increased	due	to	a	$23.8	million	tax	benefit related	to	the	reduction	of	a	state	deferred	tax	liability	as	a	result	of	an	internal	U.S.	legal	entity	restructuring	that	will	simplify	future	operating	activities within	the	U.S.	Basic	and	diluted	earnings	per	share	attributable	to	common	stockholders	were	each	increased	by	approximately	$0.09	per	share.

Consolidated	net	income	in	the	second	quarter	of	fiscal	2017	financial	results	by	quarter	(unaudited)	table	was	decreased	due	to	a	non-cash	charge	of $28.7	million	recorded	on	the	line	item	"Pension	lump	sum	settlement"	on	our	Consolidated	Statements	of	Operations	related	to	our	year	to	date	lump	sum payments	to	certain	beneficiaries	of	the	Plan,	together	with	several	one-time	severance	benefit	payments	out	of	the	Plan,	triggered	pension	settlement accounting.	For	additional	information	see	"Note	4.	Retirement	Plans".	Additionally,	consolidated	net	income	in	the	second	quarter	of	fiscal	2017	financial results	by	quarter	(unaudited)	table	was	decreased	due	to	a	non-cash	charge	of	$42.7	million,	or	$36.3	million	net	of	$6.4	million	of	noncontrolling	interest, recorded	on	the	line	item	"Land	and	development	impairments"	on	our	consolidated	statements	of	operations	due	to	the	accelerated	monetization	strategy in	our	Land	and	Development	segment.	The	impairment	was	recorded	to	write-down	the	carrying	value	on	projects	where	the	projected	sales	proceeds were	less	than	the	carrying	value.	Basic	and	diluted	earnings	per	share	attributable	to	common	stockholders	were	each	decreased	by	approximately	$0.16 per	share	for	these	items.

Consolidated	net	income	in	the	third	quarter	of	fiscal	2017	financial	results	by	quarter	(unaudited)	table	was	increased	due	to	a	pre-tax	gain	on	sale	of HH&B	of	$190.6	million.	Basic	and	diluted	earnings	per	share	from	continuing	operations	and	basic	and	diluted	earnings	per	share	attributable	to	common stockholders	 were	 each	 increased	 by	 approximately	 $0.76	 and	 $0.75	 per	 share,	 respectively.	 See	"Note	 1.	 Description	 of	 Business	 and	 Summary	 of Significant	Accounting	Policies	—	Description	of	Business"	for	additional	information.

# Note	23. Subsequent	Events	(Unaudited)

# KapStone	Acquisition

On	November	2,	2018,	pursuant	to	the	Merger	Agreement,	the	Company	acquired	all	of	the	outstanding	shares	of	KapStone	through	the	Mergers. KapStone	is	a	leading	North	American	producer	and	distributor	of	containerboard,	corrugated	products	and	specialty	papers,	including	liner	and	medium containerboard,	kraft	papers	and	saturating	kraft.	KapStone	also	owns	Victory	Packaging,	a	packaging	solutions	distribution	company	with	facilities	in	the United	States,	Canada	and	Mexico.

As	a	result	of	the	Mergers,	among	other	things,	the	Company	became	the	ultimate	parent	of	WRKCo,	KapStone	and	their	respective	subsidiaries. Effective	as	of	the	Effective	Time,	the	Company	changed	its	name	to	"WestRock	Company"	and	WRKCo	changed	its	name	to	"WRKCo	Inc.".

Pursuant	to	the	Merger	Agreement,	at	the	Effective	Time	(a)	each	issued	and	outstanding	share	of	common	stock,	par	value	$0.01	per	share,	of WRKCo	("WRKCo	common	stock")	was	converted	into	one	share	of	common	stock,	par	value	$0.01	per	share,	of	the	Company	("Company	common stock")	and	(b)	each	issued	and	outstanding	share	of	common	stock,	par	value	$0.0001	per	share,	of	KapStone	("KapStone	common	stock")	(other	than shares	of	KapStone	common	stock	owned	by	(i)	KapStone	or	any	of	its	subsidiaries	or	(ii)	any	KapStone	stockholder	who	properly	exercised	appraisal rights	with	respect	to	its	shares	of	KapStone	common	stock	in	accordance	with	Section	262	of	the	Delaware	General	Corporation	Law)	was	automatically canceled	and	converted	into	the	right	to	receive	(1)	$35.00	per	share	in	cash,	without	interest	(the	"Cash	Consideration"),	or,	at	the	election	of	the	holder	of such	share	of	KapStone	common	stock,	(2)	0.4981	shares	of	Company	common	stock	(the	"Stock	Consideration")	and	cash	in	lieu	of	fractional	shares, subject	to	proration	procedures	designed	to	ensure	that	the	Stock	Consideration	would	be	received	in	respect	of	no	more	than	 25%	of	 the	shares	of KapStone	common	stock	issued	and	outstanding	immediately	prior	to	the	Effective	Time	(the	"Maximum	Stock	Amount").	Each	share	of	KapStone	common stock	in	respect	of	which	a	valid	election	of	Stock	Consideration	was	not	made	by	5:00	p.m.	New	York	City	time	on	September	5,	2018	was	converted	into the	right	to	receive	the	Cash	Consideration.	KapStone	stockholders

elected	to	receive	Stock	Consideration	that	was	less	than	the	Maximum	Stock	Amount	and	no	proration	was	required.

The	estimated	consideration	for	the	KapStone	Acquisition	was	$4.8	billion	including	debt	assumed	and	an	estimate	of	equity	awards	to	be	replaced with	WestRock	equity	awards	with	identical	terms.	As	a	result,	KapStone	stockholders	received	in	the	aggregate	approximately	$3.3	billion	in	cash	and	 1.6 million	shares	WestRock	common	stock,	or	approximately	0.6%	of	the	issued	and	outstanding	shares	of	WestRock	common	stock	immediately	following	the Effective	Time.	Pursuant	to	the	Merger	Agreement,	at	the	Effective	Time,	the	Company	assumed	any	outstanding	awards	granted	under	the	equity-based incentive	plans	of	WRKCo	and	KapStone	(including	the	shares	underlying	such	awards),	the	award	agreements	evidencing	the	grants	of	such	awards	and, in	the	case	of	the	WRKCo	equity-based	incentive	plans,	the	remaining	shares	available	for	issuance	under	the	applicable	plan,	in	each	case	subject	to adjustments	to	such	awards	in	the	manner	set	forth	in	the	Merger	Agreement.	Due	to	the	limited	interaction	we	had	with	KapStone	prior	to	the	closing	of	the transaction,	we	do	not	currently	have	a	preliminary	purchase	price	allocation,	but	we	expect	to	complete	it	by	the	time	we	file	our	quarterly	report	on	Form 10-Q	for	the	quarter	ended	December	31,	2018.

# Hurricane	Damage

In	October	2018,	our	containerboard	and	pulp	mill	located	in	Panama	City,	FL	sustained	extensive	damage	from	Hurricane	Michael.	We	shut	down the	mill's	operations	in	advance	of	the	hurricane's	landfall.	In	early	November,	the	mill	started	producing	linerboard	and	we	expect	to	ramp	up	to	full production	by	the	end	of	November	2018.	Our	market	pulp	production	line	is	expected	to	operate	at	50%	of	capacity	by	early	December	2018	and	should return	to	full	operation	in	approximately	six	months.	While	it	is	still	too	early	to	identify	the	full	cost,	we	anticipate	the	total	of	our	property	damage	and business	interruption	claim	will	be	approximately	$100	million.	We	have	property	damage	and	business	interruption	insurance	that	will	cover	most	of	the cost	of	bringing	the	mill	back	to	full	operation.	We	have	a	$15	million	deductible,	and	expect	the	majority	of	costs	will	be	covered.

# Report	of	Independent	Registered	Public	Accounting	Firm

The	Board	of	Directors	and	Stockholders	of

# Opinion	on	the	Financial	Statements

We	have	audited	the	accompanying	consolidated	balance	sheets	of	WestRock	Company	as	of	September	30,	2018	and	2017,	and	the	related	consolidated statements	of	operations,	comprehensive	income	(loss),	equity	and	cash	flows	for	each	of	the	three	years	in	the	period	ended	September	30,	2018,	and	the related	notes	(collectively	referred	to	as	the	"consolidated	financial	statements").	In	our	opinion,	the	consolidated	financial	statements	present	fairly,	in	all material	aspects,	the	financial	position	of	the	Company	at	September	30,	2018	and	2017,	and	the	results	of	its	operations	and	its	cash	flows	for	each	of	the three	years	in	the	period	ended	September	30,	2018,	in	conformity	with	U.S.	generally	accepted	accounting	principles.

We	also	have	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States)	(PCAOB),	the	Company's internal	control	over	financial	reporting	as	of	September	30,	2018,	based	on	criteria	established	in	Internal	Control-Integrated	Framework	issued	by	the Committee	 of	 Sponsoring	 Organizations	 of	 the	 Treadway	 Commission	 (2013	 framework)	 and	 our	 report	 dated	 November	 16,	 2018,	 expressed	 an unqualified	opinion	thereon.

# Basis	for	Opinion

These	financial	statements	are	the	responsibility	of	the	Company's	management.	Our	responsibility	is	to	express	an	opinion	on	the	Company's	financial statements	based	on	our	audits.	We	are	a	public	accounting	firm	registered	with	the	PCAOB	and	are	required	to	be	independent	with	respect	to	the Company	in	accordance	with	the	U.S.	federal	securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the PCAOB.

We	conducted	our	audits	in	accordance	with	the	standards	of	the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audit	to	obtain	reasonable assurance	 about	 whether	 the	 financial	 statements	 are	 free	 of	 material	 misstatement,	 whether	 due	 to	 error	 or	 fraud.	 Our	 audits	 included	 performing procedures	to	assess	the	risks	of	material	misstatement	of	the	financial	statements,	whether	due	to	error	or	fraud,	and	performing	procedures	that	respond to	those	risks.	Such	procedures	included	examining,	on	a	test	basis,	evidence	regarding	the	amounts	and	disclosures	in	the	financial	statements.	Our audits	 also	 included	 evaluating	 the	 accounting	 principles	 used	 and	 significant	 estimates	 made	 by	 management,	 as	 well	 as	 evaluating	 the	 overall presentation	of	the	financial	statements.	We	believe	that	our	audits	provide	a	reasonable	basis	for	our	opinion.

/s/	Ernst	&	Young	LLP

We	have	served	as	the	Company's	or	its	predecessor's	auditor	since	at	least	1975,	but	we	are	unable	to	determine	the	specific	year.

Atlanta,	Georgia

# Opinion	on	Internal	Control	over	Financial	Reporting

We	have	audited	WestRock	Company's	internal	control	over	financial	reporting	as	of	 September	30,	2018,	based	on	criteria	established	in	Internal	Control- Integrated	Framework	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(2013	framework)	(the	COSO	criteria).	In	our opinion,	WestRock	Company	(the	Company)	maintained,	in	all	material	respects,	effective	internal	control	over	financial	reporting	as	of	September	30, 2018,	based	on	the	COSO	criteria.

We	also	have	audited,	in	accordance	with	the	standards	of	the	Public	Company	Accounting	Oversight	Board	(United	States)	(PCAOB),	the	 consolidated balance	sheets	of	WestRock	Company	as	of	September	30,	2018	and	2017,	and	the	related	consolidated	statements	of	operations,	comprehensive	income (loss),	equity	and	cash	flows	for	each	of	the	three	years	in	the	period	ended	September	30,	2018,	and	the	related	notes	and	our	report	dated	November	16, 2018,	expressed	an	unqualified	opinion	thereon.

The	Company's	management	is	responsible	for	maintaining	effective	internal	control	over	financial	reporting	and	for	its	assessment	of	the	effectiveness	of internal	control	over	financial	reporting	included	in	the	accompanying	Management's	Annual	Report	on	Internal	Control	over	Financial	Reporting.	Our responsibility	is	to	express	an	opinion	on	the	Company's	internal	control	over	financial	reporting	based	on	our	audit.	We	are	a	public	accounting	firm registered	with	the	PCAOB	and	are	required	to	be	independent	with	respect	to	the	Company	in	accordance	with	the	U.S.	federal	securities	laws	and	the applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the	PCAOB.

We	conducted	our	audit	in	accordance	with	the	standards	of	the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audit	to	obtain	reasonable assurance	about	whether	effective	internal	control	over	financial	reporting	was	maintained	in	all	material	respects.

Our	audit	included	obtaining	an	understanding	of	internal	control	over	financial	reporting,	assessing	the	risk	that	a	material	weakness	exists,	testing	and evaluating	the	design	and	operating	effectiveness	of	internal	control	based	on	the	assessed	risk,	and	performing	such	other	procedures	as	we	considered necessary	in	the	circumstances.	We	believe	that	our	audit	provides	a	reasonable	basis	for	our	opinion.

# Definition	and	Limitation	of	Internal	Control	Over	Financial	Reporting

A	company's	internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial	reporting and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	A	company's	internal	control over	financial	reporting	includes	those	policies	and	procedures	that	(1)	pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,	accurately	and	fairly reflect	the	transactions	and	dispositions	of	the	assets	of	the	company;	(2)	provide	reasonable	assurance	that	transactions	are	recorded	as	necessary	to permit	preparation	of	financial	statements	in	accordance	with	generally	accepted	accounting	principles,	and	that	receipts	and	expenditures	of	the	company are	being	made	only	in	accordance	with	authorizations	of	management	and	directors	of	the	company;	and	(3)	provide	reasonable	assurance	regarding prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	the	company's	assets	that	could	have	a	material	effect	on	the	financial statements.

Because	of	its	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements.	Also,	projections	of	any	evaluation	of effectiveness to future	periods	are	subject to the	risk that	controls	may	become inadequate	because	of	changes in	conditions,	or that the	degree	of compliance	with	the	policies	or	procedures	may	deteriorate.

# MANAGEMENT'S	ANNUAL	REPORT	ON	INTERNAL	CONTROL	OVER	FINANCIAL	REPORTING

# Management's	Responsibility	for	the	Financial	Statements

The	management	of	WestRock	Company	is	responsible	for	the	preparation	and	integrity	of	the	consolidated	financial	statements	appearing	in	our Annual	Report	on	Form	10-K.	The	financial	statements	were	prepared	in	conformity	with	GAAP	appropriate	in	the	circumstances	and,	accordingly,	include certain	amounts	based	on	our	best	judgments	and	estimates.	Financial	information	in	this	Annual	Report	on	Form	10-K	is	consistent	with	that	in	the financial	statements.

# Internal	Control	Over	Financial	Reporting

Management	of	our	company	is	responsible	for	establishing	and	maintaining	adequate	internal	control	over	financial	reporting	as	such	term	is	defined in	Rule	13a-15(f)	under	the	Exchange	Act.	Our	internal	control	over	financial	reporting	is	designed	to	provide	reasonable	assurance	regarding	the	reliability of	financial	reporting	and	the	preparation	of	the	consolidated	financial	statements.	Our	internal	control	over	financial	reporting	is	supported	by	a	program	of internal	audits	and	appropriate	reviews	by	management,	written	policies	and	guidelines,	careful	selection	and	training	of	qualified	personnel	and	a	written code	of	conduct	adopted	by	our	board	of	directors	that	is	applicable	to	all	officers	and	employees	of	our	Company	and	subsidiaries,	as	well	as	a	code	of conduct	that	is	applicable	to	all	of	our	directors.

Because	of	its	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements	and	even	when	determined	to	be effective,	can	only	provide	reasonable	assurance	with	respect	to	financial	statement	preparation	and	presentation.	Also,	projections	of	any	evaluation	of effectiveness	 to	 future	periods	are	subject	 to	 the	risk	 that	controls	may	become	 inadequate	because	of	changes	 in	conditions,	or	 that	 the	degree	of compliance	with	the	policies	or	procedures	may	deteriorate.

Management	 assessed	 the	 effectiveness	 of	 our	 internal	 control	 over	 financial	 reporting	 as	 of	 September	 30,	 2018.	 In	 making this	 assessment, management	 used	 the	 criteria	 set	 forth	 by	 the	 Committee	 of	 Sponsoring	 Organizations	 of	 the	 Treadway	 Commission	 (COSO) in	Internal	 Control— Integrated	Framework	(2013	framework).	The	scope	of	our	efforts	to	comply	with	Section	404	of	the	Sarbanes-Oxley	Act	with	respect	to	fiscal	2018	included all	 of	 our	 operations.	 Based	 on	 our	 assessment,	 management	 believes	 that	 we	 maintained	 effective	 internal	 control	 over	 financial	 reporting	 as	 of September	 30,	 2018.	 Our	 independent	 auditors,	 Ernst	 &	 Young	 LLP,	 an	 independent	 registered	 public	 accounting	 firm,	 are	 appointed	 by	 the	Audit Committee	of	our	board	of	directors.	Ernst	&	Young	LLP	has	audited	and	reported	on	the	consolidated	financial	statements	of	WestRock	Company,	and	has issued	an	attestation	report	on	the	effectiveness	of	our	internal	control	over	financial	reporting.	The	report	of	the	independent	registered	public	accounting firm	is	contained	in	this	Annual	Report.

# Audit	Committee	Responsibility

The	Audit	Committee	of	our	board	of	directors,	composed	solely	of	directors	who	are	independent	in	accordance	with	the	requirements	of	the	NYSE listing	standards,	the	Exchange	Act	and	our	Corporate	Governance	Guidelines,	meets	with	the	independent	auditors,	management	and	internal	auditors periodically	 to	 discuss	 internal	 control	 over	 financial	 reporting	 and	 auditing	 and	 financial	 reporting	 matters.	 The	 Audit	 Committee	 reviews	 with	 the independent	auditors	the	scope	and	results	of	the	audit	effort.	The	Audit	Committee	also	meets	periodically	with	the	independent	auditors	and	the	chief internal	auditor	without	management	present	to	ensure	that	the	independent	auditors	and	the	chief	internal	auditor	have	free	access	to	the	Audit	Committee. Our	Audit	Committee's	Report	will	be	contained	in	our	definitive	proxy	statement	issued	in	connection	with	our	2019	annual	meeting	of	stockholders	and	is incorporated	herein	by	reference.

# STEVEN	C.	VOORHEES,

Chief	Executive	Officer	and	President

WARD	H.	DICKSON,

Executive	Vice	President	and	Chief	Financial	Officer

# Item	9. CHANGES	IN	AND	DISAGREEMENTS	WITH	ACCOUNTANTS	ON	ACCOUNTING	AND	FINANCIAL	DISCLOSURE

There	were	no	changes	in	or	disagreements	with	accountants	on	accounting	and	financial	disclosure.

# Item	9A. CONTROLS	AND	PROCEDURES

# Evaluation	of	Disclosure	Controls	and	Procedures

We	maintain	disclosure	controls	and	other	procedures	that	are	designed	with	the	objective	of	ensuring	the	following:

•that	information	required	to	be	disclosed	by	us	in	the	reports	that	we	file	or	submit	under	the	Exchange	Act	are	recorded,	processed, summarized	and	reported,	within	the	time	periods	specified	in	the	SEC's	rules	and	forms;	and

•that	information	required	to	be	disclosed	by	us	in	the	reports	that	we	file	under	the	Exchange	Act	is	accumulated	and	communicated	to	our management,	 including	our	CEO	and	our	Chief	Financial	Officer	("CFO"),	 as	 appropriate	 to	 allow	 timely	 decisions	 regarding	 required disclosure.

We	have	performed	an	evaluation	of	the	effectiveness	of	the	design	and	operation	of	our	disclosure	controls	and	procedures	as	of	September	30, 2018,	under	the	supervision	and	with	the	participation	of	our	management,	including	our	CEO	and	CFO.	Based	on	that	evaluation,	our	CEO	and	CFO	have concluded	that	our	disclosure	controls	and	procedures	were	effective	as	of	September	30,	2018,	to	provide	reasonable	assurance	that	we	record,	process, summarize	and	report	the	information	we	must	disclose	in	reports	that	we	file	or	submit	under	the	Exchange	Act	within	the	time	periods	specified	in	the SEC's	rules	and	forms.

In	designing	and	evaluating	our	disclosure	controls	and	procedures,	management	recognized	that	any	controls	and	procedures,	no	matter	how	well designed	and	operated,	can	provide	only	reasonable	assurance	of	achieving	the	desired	control	objectives,	as	ours	are	designed	to	do.	Management	also noted	that	the	design	of	any	system	of	controls	is	also	based	in	part	upon	certain	assumptions	about	the	likelihood	of	future	events,	and	that	there	can	be	no assurance	that	any	such	design	will	succeed	in	achieving	its	stated	goals	under	all	potential	future	conditions,	regardless	of	how	remote.	Management necessarily	was	required	to	apply	its	judgment	in	evaluating	the	cost-benefit	relationship	of	possible	controls	and	procedures.

The	report	called	for	by	Item	308(a)	of	Regulation	S-K	is	incorporated	herein	by	reference	to	Management's	Annual	Report	on	Internal	Control	over Financial	Reporting	of	WestRock	Company,	included	in	Part	II,	Item	8	of	this	report.

The	attestation	report	called	for	by	Item	308(b)	of	Regulation	S-K	is	incorporated	herein	by	reference	to	the	Report	of	Independent	Registered	Public Accounting	Firm	on	Internal	Control	Over	Financial	Reporting,	included	in	Part	II,	Item	8	of	this	report.

Management	has	evaluated,	with	the	participation	of	our	CEO	and	CFO,	changes	in	our	internal	controls	over	financial	reporting	(as	defined	in	Rule 13a-15(f)	of	the	Exchange	Act)	during	the	quarter	ended	September	30,	2018.	In	connection	with	that	evaluation,	we	have	determined	that	there	was	no change	in	internal	control	over	financial	reporting	during	the	fourth	quarter	that	has	materially	affected,	or	is	reasonably	likely	to	materially	affect,	our	internal control	over	financial	reporting.

# CEO	and	CFO	Certifications

Our	 CEO	 and	 CFO	 have	 filed	 with	 the	 SEC	 the	 certifications	 required	 by	 Section	 302	 of	 the	 Sarbanes-Oxley	Act	 as	 Exhibits	 31.1	 and	 31.2, respectively,	to	this	Annual	Report	on	Form	10-K.	In	addition,	on	February	8,	2018,	our	CEO	certified	to	the	NYSE	that	he	was	not	aware	of	any	violation	by the	Company	of	the	NYSE	corporate	governance	listing	standards	as	in	effect	on	February	8,	2018.	The	foregoing	certification	was	unqualified.

# Item	9B. OTHER	INFORMATION

On	November	15,	2018,	the	Company	filed	with	the	Secretary	of	State	of	the	State	of	Delaware	a	Certificate	of	Correction	to	its	Amended	and Restated	Certificate	of	Incorporation,	which	became	effective	upon	filing,	to	correct	the	Company's	registered	office	in	the	State	of	Delaware	and	the Company's	registered	agent	at	such	address.	The	Certificate	of	Correction	is	attached	as	Exhibit	3.2	to	this	Form	10-K	and	is	incorporated	by	reference herein.

# PART	III

# Item	10. DIRECTORS,	EXECUTIVE	OFFICERS,	AND	CORPORATE	GOVERNANCE

# EXECUTIVE	OFFICERS

# Identification	of	Executive	Officers

The	executive	officers	of	the	Company	are	as	follows	as	of	November	13,	2018:

Steven	C.	Voorhees	has	served	as	WestRock's	chief	executive	officer	and	president	since	July	1,	2015.	He	served	as	RockTenn's	chief	executive officer	from	November	2013	through	June	30,	2015,	as	RockTenn's	president	and	chief	operating	officer	from	January	2013	through	October	2013	and	as RockTenn's	executive	vice	president	and	chief	financial	officer,	from	September	2000	through	January	2013.	Mr.	Voorhees	also	served	as	RockTenn's chief	administrative	officer	from	July	2008	through	January	2013.

Robert	A.	 Feeser	 has	 served	 as	 WestRock's	 president,	 consumer	 packaging	 since	 September	 2016.	 He	 had	 previously	 served	 as	 WestRock's executive	vice	president	of	consumer	paper	and	global	solutions	since	July	1,	2015.	Prior	to	the	Combination,	Mr.	Feeser	served	as	MWV's	executive	vice president	of	global	operations.	He	joined	MWV	in	1987,	and	held	a	number	of	leadership	roles	in	operations,	sales,	marketing	and	general	management with	the	company,	including	as	MWV's	senior	vice	president	of	packaging	from	2010	through	2014	and	as	MWV's	president,	packaging	resources	group from	2004	through	2010.

Jeffrey	 W.	 Chalovich	 has	 served	 as	 WestRock's	 president,	 corrugated	 packaging	 since	 September	 2016.	 He	 previously	 served	 as	 WestRock's executive	vice	president	of	corrugated	containers	and	commercial	excellence.	He	served	as	Rock-Tenn's	senior	vice	president	and	general	manager	of corrugated	containers	through	June	30,	2015.	Mr.	Chalovich	joined	RockTenn	in	connection	with	its	acquisition	of	Southern	Container	Corp	in	2008,	where he	served	in	a	variety	of	sales	and	general	management	roles.

James	B.	Porter	III	has	served	as	WestRock's	president,	business	development	and	Latin	America	since	September	2016.	He	previously	served	as WestRock's	president,	paper	solutions	since	July	1,	2015.	He	served	as	RockTenn's	president,	paper	solutions	from	April	2014	through	June	30,	2015,	as RockTenn's	president	-	corrugated	packaging	from	July	2012	to	April	2014,	as	RockTenn's	president	-	corrugated	packaging	and	recycling	from	May	2011 to	July	2012	and	as	executive	vice	president	of	RockTenn's	corrugated	packaging	business	from	July	2008	until	May	2011.	Mr.	Porter	joined	RockTenn	in connection	with	its	acquisition	of	Southern	Container	Corp.	in	2008.	Prior	to	his	appointment	as	executive	vice	president	of	RockTenn,	Mr.	Porter	served	as the	president	and	chief	operating	officer	of	Southern	Container	from	2004	and	as	the	president	of	Solvay	Paperboard,	a	subsidiary	of	Southern	Container, from	1997	through	2004.

Marc	P.	Shore	has	served	as	WestRock's	president,	multi	packaging	solutions	since	June	2017.	He	had	previously	served	as	chief	executive	officer	of Multi	Packaging	Solutions	International	Limited	and	Shorewood	Packaging.	Mr.	Shore	has	40	years	of	experience	in	the	print-based	specialty	packaging industry.	He	founded	MPS	in	2005	with	private	equity	sponsorship	and	helped	take	the	company	public	in	2015.	During	his	time	at	Shorewood	Packaging, he	led	the	company	through	a	successful	initial	public	offering	and	for	14	years	as	a	public	company	before	its	sale	to	International	Paper	in	2000.	Mr.	Shore continued	as	president	of	the	business	and	as	a	corporate	officer	of	International	Paper	until	2004.

Ward	H.	Dickson	has	served	as	WestRock's	executive	vice	president	and	chief	financial	officer	since	July	1,	2015.	He	served	as	RockTenn's	executive vice	president	and	chief	financial	officer	from	September	2013	through	June	30,	2015.	From	November	2011	until	September	2013,	he	served	as	the	senior vice	president	of	finance	for	the	global	sales	and	service	organization	of	Cisco	Systems,	Inc.,	and,	from	July	2009	to	November	2011,	he	served	as	the	vice president	of	finance	for	the	global	sales	and	service	organization	of	Cisco.	Mr.	Dickson	served	as	the	vice	president	of	finance	at	Scientific	Atlanta,	a division	of	Cisco,	from	February	2006	until	July	2009.	Prior	to	Cisco's	acquisition	of	Scientific	Atlanta,	Inc.	in	February	2006,	Mr.	Dickson	had	served	as	that company's	vice	president	of	worldwide	financial	operations	since	2003.

Robert	B.	McIntosh	has	served	as	WestRock's	executive	vice	president,	general	counsel	and	secretary	since	July	1,	2015.	He	served	as	RockTenn's executive	vice	president,	general	counsel	and	secretary	from	January	2009	through	June	30,	2015	and	as	RockTenn's	senior	vice	president,	general counsel	and	secretary	from	August	2000	until	January	2009.	Mr.	McIntosh	joined	RockTenn	in	1995	as	vice	president	and	general	counsel.

Vicki	L.	Lostetter	has	served	as	WestRock's	chief	human	resources	officer	since	February	2018.	She	previously	served	as	General	Manager,	Talent and	Organization	Capability	and	General	Manager,	Global	Talent	Management	with	Microsoft,	Incorporated.	Prior	to	joining	Microsoft,	Ms.	Lostetter	served in	various	leadership	roles	within	the	human	resources	function	with	Coca-Cola	Enterprises,	Inc.,	The	Coca-Cola	Company	and	Honeywell,	Inc.

Kelly	C.	Janzen	has	served	as	WestRock's	chief	accounting	officer	since	November	2017.	She	previously	had	served	as	the	Company's	senior	vice president	–	accounting	since	August	2017.	Prior	to	joining	the	Company,	she	served	as	vice	president,	controller	and	chief	accounting	officer	for	Baker Hughes	 Inc.,	 vice	 president	 finance	 and	 chief	 accounting	 officer	 for	 McDermott	 International	 Inc.	 and	 served	 in	 various	 leadership	 roles	 within	 the Controllership	function	with	General	Electric.

All	of	our	executive	officers	are	elected	annually	by,	and	serve	at	the	discretion	of,	the	board	of	directors.

See	Part	I,	Item	1	"Available	Information"	of	this	Form	10-K	for	information	about	our	Code	of	Ethical	Conduct	for	our	Chief	Executive	Officer	and Senior	Financial	Officers,	including	that	any	amendments	to,	or	waiver	from,	any	provision	of	such	code	required	to	be	disclosed	will	be	posted	on	our website.	The	remainder	of	the	information	required	by	this	item	will	be	contained	in	our	definitive	proxy	statement	issued	in	connection	with	our	2019	annual meeting	of	stockholders	and	is	incorporated	herein	by	reference.

# Item	11. EXECUTIVE	COMPENSATION

The	 information	 required	 by	 this	 item	 will	 be	 contained in	 our	 definitive	 proxy	 statement issued in	 connection	 with	 our	 2019	 annual	 meeting	 of stockholders	and	is	incorporated	herein	by	reference.

# Item	12. SECURITY	OWNERSHIP	OF	CERTAIN	BENEFICIAL	OWNERS	AND	MANAGEMENT	AND	RELATED	STOCKHOLDER	MATTERS

# Item	13. CERTAIN	RELATIONSHIPS	AND	RELATED	TRANSACTIONS,	AND	DIRECTOR	INDEPENDENCE

# Item	14. PRINCIPAL	ACCOUNTING	FEES	AND	SERVICES

# PART	IV

# Item	15. EXHIBITS	AND	FINANCIAL	STATEMENT	SCHEDULES

# (a)	1.	Financial	Statements.

The	following	consolidated	financial	statements	of	our	company	and	our	consolidated	subsidiaries	and	the	Report	of	the	Independent	Registered Public	Accounting	Firm	are	included	in	Part	II,	Item	8	of	this	report:

| Consolidated	Statements	of	Operations	for	the	years	ended	September	2018,	2017	and	2016 | 59 |
| :--- | :--- |
| Consolidated\tStatements\tof\tComprehensive\tIncome\t(Loss)\tfor\tthe\tyears\tended\tSeptember\t2018,\t2017\tand\t2016 | 60 |
| Consolidated\tBalance\tSheets\tas\tof\tSeptember\t30,\t2018\tand\t2017 | 61 |
| Consolidated\tStatements\tof\tEquity\tfor\tthe\tyears\tended\tSeptember\t30,\t2018,\t2017\tand\t2016 | 62 |
| Consolidated\tStatements\tof\tCash\tFlows\tfor\tthe\tyears\tended\tSeptember\t30,\t2018,\t2017\tand\t2016 | 64 |
| Notes\tto\tConsolidated\tFinancial\tStatements | 66 |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm | 134 |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm\ton\tInternal\tControl\tOver\tFinancial\tReporting | 135 |
| Management's\tAnnual\tReport\ton\tInternal\tControl\tOver\tFinancial\tReporting | 137 |

# 2.	Financial	Statement	Schedule	of	WestRock	Company.

All	schedules	are	omitted	because	they	are	not	applicable	or	not	required	because	this	information	is	provided	in	the	financial	statements.

# 3.	Exhibits.

# See	separate	Exhibit	Index	attached	hereto	and	incorporated	herein.

# (b)	See	Item	15(a)(3)	and	separate	Exhibit	Index	attached	hereto	and	incorporated	herein.

# (c)	Not	applicable.

None.

# INDEX	TO	EXHIBITS

# Exhibit

				2.2(a) Second	Amended	 and	 Restated	 Business	 Combination	Agreement,	 dated	 as	 of	April	 17,	 2015,	 by	 and	 among	 WestRock	 Company, MeadWestvaco	Corporation,	Rock-Tenn	Company,	Milan	Merger	Sub,	LLC	and	Rome	Merger	Sub,	 Inc.	(incorporated	by	reference	 to Annex	A	of	WestRock's	Registration	Statement	on	Form	S-4	initially	filed	with	the	SEC	on	March	10,	2015	and	as	amended	on	April	20, 2015,	May	6,	2015	and	May	18,	2015,	File	No.	333-202643).†

				2.2(b) First	Amendment	 to	 the	Second	Amended	and	Restated	Business	Combination	Agreement,	dated	as	of	May	5,	2015,	by	and	among WestRock	Company,	MeadWestvaco	Corporation,	Rock-Tenn	Company,	Milan	Merger	Sub,	LLC	and	Rome	Merger	Sub,	Inc.	(incorporated by	reference	to	Exhibit	2.2	of	WestRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2015).†

				2.4 Purchase	Agreement,	dated	January	23,	2017,	by	and	among	Silgan	Holdings	LLC,	Silgan	White	Cap	Holdings	Spain,	S.L.,	Silgan	Holdings B.V.,	Silgan	Holdings	Inc.,	WestRock	MWV,	LLC	and	WestRock	Company	(incorporated	by	reference	to	Exhibit	2.4	of	WestRock's	Current Report	on	Form	8-K	filed	on	January	24,	2017).†

				2.9 Voting	Agreement,	dated	January	28,	2018,	between	WestRock	Company	and	Roger	Stone	(incorporated	by	reference	to	Exhibit	2.2	of WestRock's	Current	Report	on	Form	8-K	filed	on	January	29,	2018).

				2.10 Voting	Agreement,	dated	January	28,	2018,	between	WestRock	Company	and	Matthew	Kaplan	(incorporated	by	reference	to	Exhibit	2.3	of WestRock's	Current	Report	on	Form	8-K	filed	on	January	29,	2018).

				2.11 Voting	Agreement,	dated	January	28,	2018,	between	WestRock	Company	and	the	R.	W	Stone	Revocable	Trust	(incorporated	by	reference to	Exhibit	2.4	of	WestRock's	Current	Report	on	Form	8-K	filed	on	January	29,	2018).

				2.12 Voting	 Agreement,	 dated	 January 28, 2018,	 between	 WestRock	 Company	 and	 the	 Roger	 and	 Susan	 Stone	 Family	 Foundation (incorporated	by	reference	to	Exhibit	2.5	of	WestRock's	Current	Report	on	Form	8-K	filed	on	January	29,	2018).

				3.1 Amended	and	Restated	Certificate	of	Incorporation	of	WestRock	Company,	effective	as	of	November	2,	2018	(incorporated	by	reference	to Exhibit	3.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	November	5,	2018).

Certificate	of	Correction	to	the	Amended	and	Restated	Certificate	of	Incorporation	of	WestRock	Company	dated	November	13,	2018.

Amended	and	Restated	Bylaws	of	WestRock	Company,	effective	as	of	November	2,	2018	(incorporated	by	reference	to	Exhibit	3.2	of WestRock's	Current	Report	on	Form	8-K	filed	on	November	5,	2018).

				4.1(a) Form	of	Indenture,	dated	as	of	July	15,	1982,	between	The	Mead	Corporation	and	Deutsche	Bank	Trust	Company	Americas	(formerly Bankers	Trust	Company),	as	Trustee	(incorporated	by	reference	to	Exhibit	4.viv	of	MWV's	Annual	Report	on	Form	10-K	for	the	Transition Period	ended	December	31,	2001).

				4.1(b) First	Supplemental	Indenture,	dated	as	of	March	1,	1987,	to	the	Indenture	dated	as	of	July	15,	1982,	between	The	Mead	Corporation	and Deutsche	Bank	Trust	Company	Americas	(formerly	Bankers	Trust	Company),	as	Trustee	(incorporated	by	reference	to	Exhibit	4.viv	of MWV's	Annual	Report	on	Form	10-K	for	the	Transition	Period	ended	December	31,	2001).

				4.1(c) Second	Supplemental	Indenture,	dated	as	of	October	15,	1989,	to	the	Indenture	dated	as	of	July	15,	1982,	between	The	Mead	Corporation and	Deutsche	Bank	Trust	Company	Americas	(formerly	Bankers	Trust	Company),	as	Trustee	(incorporated	by	reference	to	Exhibit	4.viv	of MWV's	Annual	Report	on	Form	10-K	for	the	Transition	Period	ended	December	31,	2001).

				4.1(d) Third	Supplemental	Indenture,	dated	as	of	November	15,	1991,	to	the	Indenture	dated	as	of	July	15,	1982,	between	The	Mead	Corporation and	Deutsche	Bank	Trust	Company	Americas	(formerly	Bankers	Trust	Company),	as	Trustee	(incorporated	by	reference	to	Exhibit	4.viv	of MWV's	Annual	Report	on	Form	10-K	for	the	Transition	Period	ended	December	31,	2001).

				4.1(e) Fourth	Supplemental	Indenture,	dated	as	of	January	31,	2002,	to	the	Indenture	dated	as	of	July	15,	1982,	between	The	Mead	Corporation, WestRock	 MWV,	 LLC	 (formerly	 MeadWestvaco	 Corporation),	 Westvaco	 Corporation	 and	 Deutsche	 Bank	 Trust	 Company	 Americas (formerly	Bankers	Trust	Company),	as	Trustee	(incorporated	by	reference	to	Exhibit	4.2	of	MWV's	Current	Report	on	Form	8-K	filed	on February	1,	2002).

				4.1(f) Fifth	Supplemental	Indenture,	dated	as	of	December	31,	2002,	to	the	Indenture	dated	as	of	July	15,	1982,	between	MW	Custom	Papers, Inc.	and	Deutsche	Bank	Trust	Company	Americas,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.2	of	MWV's	Current	Report	on	Form 8-K	filed	on	January	7,	2003).

				4.1(g) Sixth	Supplemental	Indenture,	dated	as	of	December	31,	2002,	to	the	Indenture	dated	as	of	July	15,	1982,	between	WestRock	MWV,	LLC (formerly	MeadWestvaco	Corporation)	and	Deutsche	Bank	Trust	Company	Americas,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.3	of MWV's	Current	Report	on	Form	8-K	filed	on	January	7,	2003).

				4.1(h) Seventh	Supplemental	Indenture,	dated	as	of	July	1,	2015,	to	the	Indenture	dated	as	of	July	15,	1982,	between	WestRock	MWV,	LLC (formerly	MeadWestvaco	Corporation)	and	Deutsche	Bank	Trust	Company	Americas,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.3	of WestRock's	Current	Report	on	Form	8-K	filed	on	July	2,	2015).

P	4.2(a) Form	of	Indenture,	dated	as	of	March	1,	1983,	between	Westvaco	Corporation	and	The	Bank	of	New	York	(formerly	Irving	Trust	Company), as	Trustee	(incorporated	by	reference	to	Exhibit	2	of	Westvaco	Corporation's	Registration	Statement	on	Form	8-A	filed	on	January	24, 1984).

				4.2(b) First	 Supplemental	 Indenture,	 dated	 as	 of	 January	 31,	 2002,	 to	 the	 Indenture	 dated	 as	 of	 March	 1,	 1983,	 by	 and	 among	 Westvaco Corporation,	WestRock	MWV,	LLC	(formerly	MeadWestvaco	Corporation),	The	Mead	Corporation	and	The	Bank	of	New	York,	as	Trustee (incorporated	by	reference	to	Exhibit	4.1	of	MWV's	Current	Report	on	Form	8-K	filed	on	February	1,	2002).

				4.2(c) Second	Supplemental	Indenture,	dated	as	of	December	31,	2002,	to	the	Indenture	dated	as	of	March	1,	1983,	between	WestRock	MWV, LLC	(formerly	MeadWestvaco	Corporation)	and	The	Bank	of	New	York,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.1	of	MWV's Current	Report	on	Form	8-K	filed	on	January	7,	2003).

Third	Supplemental	 Indenture,	dated	as	of	July	1,	2015,	 to	 the	 Indenture	dated	as	of	March	1,	1983,	between	WestRock	MWV,	LLC (formerly	 MeadWestvaco	 Corporation)	 and	 The	 Bank	 of	 New	 York	 Mellon,	 as	 Trustee	 (incorporated	 by	 reference	 to	 Exhibit	 4.4	 of WestRock's	Current	Report	on	Form	8-K	filed	on	July	2,	2015).

				4.3(a) Indenture,	dated	as	of	February	1,	1993,	between	The	Mead	Corporation	and	The	First	National	Bank	of	Chicago,	as	Trustee	(incorporated by	reference	to	Exhibit	4.vv	of	MWV's	Annual	Report	on	Form	10-K	for	the	Transition	Period	ended	December	31,	2001).

				4.3(b) First	Supplemental	Indenture,	dated	as	of	January	31,	2002,	to	the	Indenture	dated	as	of	February	1,	1993,	between	The	Mead	Corporation, WestRock	 MWV,	 LLC	 (formerly	 MeadWestvaco	 Corporation),	 Westvaco	 Corporation	 and	 Bank	 One	 Trust	 Company,	 NA,	 as	 Trustee (incorporated	by	reference	to	Exhibit	4.3	of	MWV's	Current	Report	on	Form	8-K	filed	on	February	1,	2002).

				4.3(c) Second	Supplemental	Indenture,	dated	as	of	December	31,	2002,	to	the	Indenture	dated	as	of	February	1,	1993,	between	MW	Custom Papers,	Inc.	and	Bank	One	Trust	Company,	NA,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.4	of	MWV's	Current	Report	on	Form	8-K filed	on	January	7,	2003).

				4.3(d) Third	Supplemental	Indenture,	dated	as	of	December	31,	2002,	to	the	Indenture	dated	as	of	February	1,	1993,	between	WestRock	MWV, LLC	(formerly	MeadWestvaco	Corporation)	and	Bank	One	Trust	Company,	NA,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.5	of MWV's	Current	Report	on	Form	8-K	filed	on	January	7,	2003).

				4.3(e) Fourth	Supplemental	Indenture,	dated	as	of	July	1,	2015,	to	the	Indenture	dated	as	of	February	1,	1993,	between	WestRock	MWV,	LLC (formerly	 MeadWestvaco	 Corporation)	 and	 The	 Bank	 of	 New	 York	 Mellon,	 as	 Trustee	 (incorporated	 by	 reference	 to	 Exhibit	 4.5	 of WestRock's	Current	Report	on	Form	8-K	filed	on	July	2,	2015).

				4.4(a) Indenture,	dated	as	of	April	2,	2002,	by	and	among	WestRock	MWV,	LLC	(formerly	MeadWestvaco	Corporation),	Westvaco	Corporation, The	Mead	Corporation	and	The	Bank	of	New	York,	as	Trustee,	(incorporated	by	reference	to	Exhibit	4(a)	of	MWV's	Current	Report	on	Form 8-K	filed	on	April	2,	2002).

				4.4(b) First	Supplemental	Indenture,	dated	as	of	July	1,	2015,	to	the	Indenture	dated	as	of	April	2,	2002,	between	WestRock	MWV,	LLC	(formerly MeadWestvaco	Corporation)	and	The	Bank	of	New	York	Mellon,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.6	of	WestRock's	Current Report	on	Form	8-K	filed	on	July	2,	2015).

				4.5(a) Indenture,	dated	as	of	February	22,	2012,	by	and	among	Rock-Tenn	Company,	the	Guarantors	(as	defined	therein)	and	HSBC	Bank	USA, National	Association,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.18	of	RockTenn's	Registration	Statement	on	Form	S-4	filed	on February	8,	2013,	File	No.	333-186552).

				4.5(b) Registration	Rights	Agreement,	dated	as	of	February	22,	2012,	by	and	among	Rock-Tenn	Company,	the	Guarantors	(as	defined	therein), and	J.P.	Morgan	Securities	LLC,	Merrill	Lynch,	Pierce,	Fenner	&	Smith	Incorporated	and	Wells	Fargo	Securities,	LLC,	as	representatives	of the	 several	 Initial	 Purchasers	 (incorporated	 by	 reference	 to	 Exhibit	 4.20	 of	 RockTenn's	 Registration	 Statement	 on	 Form	 S-4	 filed	 on February	8,	2013,	File	No.	333-186552).

				4.5(c) First	Supplemental	Indenture,	dated	as	of	November	7,	2013,	to	the	Indenture	dated	as	of	February	22,	2012,	by	and	among	Rock-Tenn Company,	the	Guarantors	(as	defined	therein)	and	HSBC	Bank	USA,	National	Association,	as	Trustee	(incorporated	by	reference	to	Exhibit 4.6(c)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

				4.5(d) Second	Supplemental	Indenture,	dated	as	of	February	21,	2014,	to	the	Indenture	dated	as	of	February	22,	2012,	by	and	among	Rock-Tenn Company,	the	Guarantors	(as	defined	therein)	and	HSBC	Bank	USA,	National	Association,	as	Trustee	(incorporated	by	reference	to	Exhibit 4.6(d)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

				4.5(e) Third	Supplemental	 Indenture,	dated	as	of	July	1,	2015,	 to	 the	 Indenture	 dated	 as	 of	 February	 22,	 2012,	 by	 and	 among	 Rock-Tenn Company,	the	Guarantors	(as	defined	therein)	and	HSBC	Bank	USA,	National	Association,	as	Trustee	(incorporated	by	reference	to	Exhibit 4.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	July	2,	2015).

Indenture,	dated	as	of	September	11,	2012,	by	and	among	Rock-Tenn	Company,	the	Guarantors	(as	defined	therein)	and	The	Bank	of	New York	Mellon	Trust	Company,	N.A.,	as	Trustee	(incorporated	by	reference	to	Exhibit	4.1	of	RockTenn's	Current	Report	on	Form	8-K	filed	on October	2,	2012).

				4.6(b) Registration	Rights	Agreement,	dated	as	of	September	11,	2012,	by	and	among	Rock-Tenn	Company,	the	Guarantors	(as	defined	therein), and	J.P.	Morgan	Securities	LLC,	Merrill	Lynch,	Pierce,	Fenner	&	Smith	Incorporated,	SunTrust	Robinson	Humphrey,	Inc.	and	Wells	Fargo Securities,	LLC,	as	representatives	of	the	several	Initial	Purchasers	(incorporated	by	reference	to	Exhibit	4.2	of	RockTenn's	Current	Report on	Form	8-K	filed	on	October	2,	2012).

				4.6(c) First	Supplemental	Indenture,	dated	as	of	November	7,	2013,	to	the	Indenture	dated	as	of	September	11,	2012,	by	and	among	Rock-Tenn Company,	 the	Guarantors	(as	defined	 therein)	and	The	Bank	of	New	York	Mellon	Trust	Company,	N.A.,	as	Trustee	(incorporated	by reference	to	Exhibit	4.7(c)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

				4.6(d) Second	Supplemental	Indenture,	dated	as	of	February	21,	2014,	to	the	Indenture	dated	as	of	September	11,	2012,	by	and	among	Rock- Tenn	Company,	the	Guarantors	(as	defined	therein)	and	The	Bank	of	New	York	Mellon	Trust	Company,	N.A.,	as	Trustee	(incorporated	by reference	to	Exhibit	4.7(d)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

				4.6(e) Third	Supplemental	Indenture,	dated	as	of	July	1,	2015,	to	the	Indenture	dated	as	of	September	11,	2012,	by	and	among	Rock-Tenn Company,	 the	Guarantors	(as	defined	 therein)	and	The	Bank	of	New	York	Mellon	Trust	Company,	N.A.,	as	Trustee	(incorporated	by reference	to	Exhibit	4.2	of	WestRock's	Current	Report	on	Form	8-K	filed	on	July	2,	2015).

				4.7(a) Indenture,	dated	August	24,	2017,	by	and	among	WestRock	Company,	WestRock	MWV	LLC,	WestRock	RKT	Company	and	The	Bank	of New	York	Mellon	Trust	Company,	N.A.,	as	trustee	(incorporated	by	reference	to	Exhibit	4.1	of	WestRock's	Current	Report	on	Form	8-K	filed on	August	24,	2017).

				4.7(b) First	Supplemental	Indenture,	dated	August	24,	2017,	by	and	among	WestRock	Company,	WestRock	MWV	LLC,	WestRock	RKT	Company and	The	Bank	of	New	York	Mellon	Trust	Company,	N.A.,	as	trustee	(incorporated	by	reference	to	Exhibit	4.2	of	WestRock's	Current	Report on	Form	8-K	filed	on	August	24,	2017).

				4.7(c) Registration	 Rights	Agreement,	 dated	August	 24,	 2017,	 by	 and	 among	 WestRock	 Company,	 WestRock	 MWV	 LLC,	 WestRock	 RKT Company,	and	Merrill	Lynch,	Piece,	Fenner	&	Smith	Incorporated,	J.P.	Morgan	Securities	LLC,	SMBC	Nikko	Securities	America,	Inc.,	TD Securities	(USA)	LLC,	HSBC	Securities	(USA)	Inc.,	MUFG	Securities	Americas	Inc.	and	Rabo	Securities	USA,	Inc.,	as	representatives	of the	initial	purchasers	named	therein	(incorporated	by	reference	to	Exhibit	4.3	of	WestRock's	Current	Report	on	Form	8-K	filed	on	August	24, 2017).

				4.7(d) Second	Supplemental	Indenture,	dated	as	of	March	6,	2018,	by	and	among	WestRock	Company,	WestRock	MWV	LLC,	WestRock	RKT Company	and	The	Bank	of	New	York	Mellon	Trust	Company,	N.A.,	as	trustee	(incorporated	by	reference	to	Exhibit	4.1	of	WestRock's Current	Report	on	Form	8-K	filed	on	March	6,	2018).

				4.7(e) Registration	Rights	Agreement,	dated	as	of	March	6,	2018,	by	and	among	WestRock	Company,	WestRock	MWV	LLC,	WestRock	RKT Company,	and	Wells	Fargo	Securities,	LLC,	Merrill	Lynch,	Pierce,	Fenner	&	Smith	 Incorporated,	Mizuho	Securities	USA	LLC,	MUFG Securities	Americas	Inc.,	Scotia	Capital	(USA)	 Inc.,	SMBC	Nikko	Securities	America,	 Inc.	and	SunTrust	Robinson	Humphrey,	 Inc.,	as representatives	of	the	initial	purchasers	named	therein	(incorporated	by	reference	to	Exhibit	4.2	of	WestRock's	Current	Report	on	Form	8-K filed	on	March	6,	2018).

*10.1(a) The	Mead	Corporation	1996	Stock	Option	Plan,	as	amended	through	June	24,	1999	(incorporated	by	reference	to	Exhibit	10.3	of	The	Mead Corporation's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	July	4,	1999).

*10.1(b) The	Mead	Corporation	1996	Stock	Option	Plan,	as	amended	February	22,	2001	(incorporated	by	reference	to	Appendix	2	of	The	Mead Corporation's	Definitive	Proxy	Statement	for	the	2001	Annual	Meeting	of	Shareholders	filed	with	the	SEC	on	March	9,	2001).

Amendment	to	The	Mead	Corporation	1996	Stock	Option	Plan,	effective	April	23,	2002	(incorporated	by	reference	to	Exhibit	10.3	of	MWV's Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2002).

*10.1(d) Amendment	to	The	Mead	Corporation	1996	Stock	Option	Plan,	effective	January	23,	2007	(incorporated	by	reference	to	Exhibit	10.4	of MWV's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2007).

*10.2(a) Rock-Tenn	Company	Annual	Executive	Bonus	Program	(incorporated	by	reference	to	Appendix	A	of	RockTenn's	Definitive	Proxy	Statement for	the	2002	Annual	Meeting	of	Shareholders	filed	with	the	SEC	on	December	19,	2001).

*10.2(b) Amendment	Number	1	to	Rock-Tenn	Company	Annual	Executive	Bonus	Program	(incorporated	by	reference	to	Exhibit	10.1	of	RockTenn's Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	December	31,	2008).

*10.2(c) WestRock	Company	Second	Amended	and	Restated	Annual	Executive	Bonus	Plan	(incorporated	by	reference	to	pages	A-1	to	A-3	of WestRock's	Definitive	Proxy	Statement	for	the	2018	Annual	Meeting	of	Shareholders	filed	with	the	SEC	on	December	19,	2017).

*10.4(a) Rock-Tenn	Company	2004	Incentive	Stock	Plan	(incorporated	by	reference	to	Exhibit	10.1	of	RockTenn's	Current	Report	on	Form	8-K	filed on	February	3,	2005).

*10.6(a) Amended	and	Restated	Rock-Tenn	Company	Supplemental	Retirement	Savings	Plan,	effective	as	of	January	1,	2006	(incorporated	by reference	to	Exhibit	10.4	of	RockTenn's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	December	31,	2005).

*10.6(b) Second	Amendment	to	the	Rock-Tenn	Company	Supplemental	Retirement	Savings	Plan,	effective	as	of	November	16,	2007	(incorporated by	reference	to	Exhibit	10.2	of	RockTenn's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	December	31,	2007).

*10.6(c) First	Amendment	to	the	Rock-Tenn	Company	Supplemental	Retirement	Savings	Plan,	effective	as	of	October	1,	2011	(incorporated	by reference	to	Exhibit	10.1	of	RockTenn's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	March	31,	2012).

*10.7(a) MeadWestvaco	Corporation	Deferred	Income	Plan	Restatement,	effective	January	1,	2007	(incorporated	by	reference	to	Exhibit	10.25	of MWV's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2008).

*10.7(b) First	Amendment	to	the	MeadWestvaco	Corporation	Deferred	Income	Plan	(2007	Restatement)	effective	September	1,	2013	(incorporated by	reference	to	Exhibit	10.7(b)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

Second	Amendment	to	the	MeadWestvaco	Corporation	Deferred	Income	Plan	(2007	Restatement)	effective	January	1,	2015	(incorporated by	reference	to	Exhibit	10.7(c)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

*10.7(d) Third	Amendment	to	the	MeadWestvaco	Corporation	Deferred	Income	Plan	(2007	Restatement)	effective	July	1,	2015	(incorporated	by reference	to	Exhibit	10.7(d)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

*10.18 Amendments	to	Grants	under	the	MeadWestvaco	Corporation	2005	Performance	Incentive	Plan	Amended	and	Restated	Effective	February 25,	2013	(2005	Performance	Incentive	Plan),	effective	January	27,	2014	(incorporated	by	reference	to	Exhibit	10.47	of	MWV's	Annual Report	on	Form	10-K	for	the	year	ended	December	31,	2013).

10.19 Sixth	 Amended	 and	 Restated	 Receivables	 Sale	 Agreement,	 dated	 July	 22,	 2016,	 among	 WestRock	 Company	 of	 Texas,	 WestRock Converting	 Company,	 WestRock	 Mill	 Company,	 LLC,	 WestRock	 -	 Southern	 Container,	 LLC,	 WestRock	 California,	 Inc.,	 WestRock Minnesota	 Corporation,	 WestRock	 CP,	 LLC,	 WestRock	 -	 Solvay,	 LLC,	 WestRock	 -	 REX,	 LLC,	 WestRock	 -	 Graphics,	 Inc.,	 WestRock Commercial,	 LLC,	 WestRock	 Packaging,	 Inc.,	 WestRock	 Slatersville	 LLC,	 WestRock	 Consumer	 Packaging	 Group,	 LLC,	 WestRock Dispensing	Systems,	 Inc.,	and	WestRock	Packaging	Systems,	LLC	(incorporated	by	reference	 to	Exhibit	10.20	of	WestRock's	Annual Report	on	Form	10-K	for	the	year	ended	September	30,	2016).

*10.20 Employment	Agreement	by	and	among	RockTenn-Southern	Container,	LLC	(successor-in-interest	to	Southern	Container	Corp.),	Rock- Tenn	Services	Inc.,	and	James	B.	Porter	III,	dated	as	of	December	22,	2014,	and	effective	as	of	January	1,	2015	(incorporated	by	reference to	Exhibit	10.1	of	RockTenn's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ending	December	31,	2014).

*10.22 Summary	of	MeadWestvaco	Corporation	2015	Annual	Incentive	Plan	(incorporated	by	reference	to	Exhibit	10.50	to	MWV's	quarterly	report on	Form	10-Q	for	the	period	ended	March	31,	2015).

10.23(a) Seventh	Amended	and	Restated	Credit	and	Security	Agreement,	dated	as	of	June	29,	2015	among	Rock-Tenn	Financial,	Inc.,	as	Borrower, Rock-Tenn	Converting	Company,	as	Servicer,	the	Lenders	and	Co-Agents	from	time	to	time	party	thereto,	and	Coöperatieve	Centrale Raiffeisen-Boerenleenbank	B.A.,	"Rabobank	Nederland",	New	York	Branch,	as	Administrative	Agent	and	as	Funding	Agent	(incorporated	by reference	to	Exhibit	10.1	of	WestRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2015).

10.23(b) Eighth	Amended	and	Restated	Credit	and	Security	Agreement,	dated	July	22,	2016,	among	WestRock	Financial	Inc.,	WestRock	Converting Company,	the	lenders	and	co-agents	from	time	to	time	party	thereto	and	Cooperatieve	Rabobank,	U.A.	(incorporated	by	reference	to	Exhibit 10.24(b)	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2016).

*10.24 Letter	Agreement	between	MeadWestvaco	Corporation,	Rock-Tenn	Company	and	John	A.	Luke,	Jr.,	dated	June	30,	2015	(incorporated	by reference	to	Exhibit	10.25	of	WestRock's	Annual	Report	on	Form	10-K	for	the	year	ended	September	30,	2015).

		10.25(a) Credit	Agreement,	dated	as	of	July	1,	2015,	among	the	Company,	Rock-Tenn	Company	of	Canada	Holdings	Corp./Compagnie	de	Holdings RockTenn	 du	 Canada	 Corp.,	 certain	 subsidiaries	 of	 the	 Company	 from	 time	 to	 time	 party	 thereto	 as	 subsidiary	 borrowers,	 certain subsidiaries	of	the	Company	from	time	to	time	party	thereto	as	guarantors,	the	lenders	party	thereto	and	Wells	Fargo	Bank,	National Association,	as	administrative	agent	and	multicurrency	agent	(incorporated	by	reference	to	Exhibit	10.1	of	WestRock's	Current	Report	on Form	8-K	filed	on	July	2,	2015).

		10.25(b) Amendment	 No.	 1,	 dated	 July	 1,	 2016,	 among	 WestRock	 Company,	 WestRock	 Company	 of	 Canada	 Holdings	 Corp./Compagnie	 de Holdings	 WestRock	 du	 Canada	 Corp.,	 the	 other	 Credit	 Parties,	 the	 Lenders	 thereto	 and	 Wells	 Fargo	 Bank,	 National	Association,	 as administrative	agent	and	multicurrency	agent	for	the	Lenders	to	the	Credit	Agreement,	dated	July	1,	2015	(incorporated	by	reference	to Exhibit	10.27.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	July	7,	2016).

		10.29(a) Uncommitted	 and	 Revolving	 Credit	 Line	 Agreement,	 dated	 November	 2,	 2015,	 between	 Sumitomo	 Mitsui	 Banking	 Corporation	 and WestRock	 Company	 (incorporated	 by	 reference	 to	 Exhibit	 10.1	 of	 WestRock's	 Quarterly	 Report	 on	 Form	 10-Q	 for	 the	 quarter	 ended December	31,	2015).

		10.29(b) Second	Amendment,	dated	February	7,	2018,	among	WestRock	Company,	the	guarantors	named	therein	and	Sumitomo	Mitsui	Banking Corporation	to	the	Uncommitted	and	Revolving	Credit	Line	Agreement,	dated	December	1,	2015	(incorporated	by	reference	to	Exhibit	10.6 of	WestRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	March	31,2018).

Employee	Stock	Purchase	Plan,	dated	February	2,	2016	(incorporated	by	reference	to	Exhibit	10.1	of	WestRock's	Quarterly	Report	on	Form 10-Q	for	the	quarter	ended	March	31,	2016).

*10.31(a) WestRock	Company	2016	Stock	Incentive	Plan	(incorporated	by	reference	to	Exhibit	10.2	of	WestRock's	Quarterly	Report	on	Form	10-Q	for the	quarter	ended	March	31,	2016).

*10.43(a) Amended	 and	 Restated	 Employment	Agreement,	 dated	 January	 1,	 2008,	 between	 MeadWestvaco	 Corporation	 and	 Robert	A.	 Feeser (incorporated	by	reference	to	Exhibit	99.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	December	16,	2016).

*10.43(b) Letter	Agreement,	dated	December	12,	2016,	between	WestRock	Company	and	Robert	A.	Feeser	(incorporated	by	reference	to	Exhibit 99.2	of	WestRock's	Current	Report	on	Form	8-K	filed	on	December	16,	2016).

		10.45 Credit	Agreement,	dated	as	of	May	15,	2017,	by	and	among	WestRock	Company,	as	Parent,	MWV	Luxembourg	S.À	R.L.	and	WestRock Packaging	Systems	UK	LTD.,	as	Borrowers,	the	lenders	party	thereto,	Coöperatieve	Rabobank	U.A.,	New	York	Branch,	as	Administrative Agent,	Coöperatieve	Rabobank	U.A.,	New	York	Branch,	as	Joint	Lead	Arranger	and	Sole	Bookrunner,	and	Sumitomo	Mitsui	Banking Corporation,	TD	Bank,	N.A.,	and	HSBC	Bank	USA,	National	Association	as	Joint	Lead	Arrangers	and	Co-Syndication	Agents	(incorporated by	reference	to	Exhibit	10.1	of	WestRock's	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	June	30,	2017).

		10.46 Form	 of	 Dealer	 Agreement	 between	 WestRock	 Company,	 WestRock	 RKT	 Company,	 WestRock	 MWV,	 LLC	 and the	 Dealer thereto (incorporated	by	reference	to	Exhibit	10.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	November	2,	2017).

		10.47 Credit	Agreement,	dated	October	31,	2017,	among	WestRock	Company,	the	subsidiaries	of	the	Company	from	time	to	time	party	thereto, as	borrowers,	the	subsidiaries	of	the	Company	from	time	to	time	party	thereto,	as	guarantors,	the	lenders	from	time	to	time	party	thereto	and Wells	Fargo	Bank,	National	Association,	as	administrative	agent	(incorporated	by	reference	to	Exhibit	10.2	of	WestRock's	Current	Report on	Form	8-K	filed	on	November	2,	2017).

		10.49 Credit	Agreement,	dated	as	of	October	31,	2017,	among	WestRock	Company,	the	subsidiaries	of	the	Company	from	time	to	time	party thereto,	as	borrowers,	the	subsidiaries	of	the	Company	from	time	to	time	party	thereto,	as	guarantors,	the	lenders	from	time	to	time	party thereto	and	Wells	Fargo	Bank,	National	Association,	as	administrative	agent	(incorporated	by	reference	to	Exhibit	10.2	of	WestRock's Current	Report	on	Form	8-K	filed	on	November	2,	2017).

		10.50(a) Credit	Agreement,	dated	as	of	March	7,	2018,	among	Whiskey	Holdco,	Inc.,	as	borrower,	WestRock	Company	and	its	subsidiaries	from time	to	time	party	thereto,	as	guarantors,	the	lenders	from	time	to	time	party	thereto	and	Wells	Fargo	Bank,	National	Association,	as administrative	agent	(incorporated	by	reference	to	Exhibit	10.1	of	WestRock's	Current	Report	on	Form	8-K	filed	on	March	9,	2018).

		10.50(b) Amendment	No.	1	to	the	Credit	Agreement,	dated	as	of	March	7,	2018,	among	WestRock	Company,	WestRock	RKT	Company,	WestRock MWV,	LLC,	Wells	Fargo	Bank,	National	Association,	and	the	lenders	party	thereto	Amendment	(incorporated	by	reference	to	Exhibit	10.3	of WestRock's	Current	Report	on	Form	8-K	filed	on	March	9,	2018).

		10.50(c) Amendment	No.	2	 to	 the	Credit	Agreement,	dated	as	of	March	7,	2018,	among	WestRock	Company,	WestRock	CP,	LLC,	WestRock Converting	 Company,	 WestRock	 Virginia	 Corporation,	 WestRock	 RKT	 Company,	 WestRock	 MWV,	 LLC,	 CoBank	ACB	 and	 the	 voting participants	party	thereto	(incorporated	by	reference	to	Exhibit	10.4	of	WestRock's	Current	Report	on	Form	8-K	filed	on	March	9,	2018).

		10.50(d) Amendment	No.	3	to	the	Credit	Agreement,	dated	as	of	March	7,	2018,	among	WestRock	Company,	WestRock	Company	of	Canada Holdings	Corp./Compagnie	de	Holdings	WestRock	du	Canada	Corp.,	WestRock	RKT	Company,	WestRock	MWV,	LLC,	Wells	Fargo	Bank, National	Association,	and	the	lenders	party	thereto	(incorporated	by	reference	to	Exhibit	10.2	of	WestRock's	Current	Report	on	Form	8-K filed	on	March	9,	2018).

		10.51 Credit	Agreement,	 dated	 as	 of	April	 27,	 2018,	 among	 WestRock	 Company,	 as	 parent,	 WRK	 Luxembourg	 S.à	 r.l.,	 WRK	 International Holdings	S.à	r.l.,	Multi	Packaging	Solutions	Limited	and	WestRock	Packaging	Systems	Germany	GmbH,	as	borrowers,	the	lenders	party thereto	 and	 Coöperatieve	 Rabobank	 U.A.,	 New	 York	 Branch,	 as	 administrative	 agent	 (incorporated	 by	 reference	 to	 Exhibit	 10.1	 of WestRock's	Current	Report	on	Form	8-K	filed	on	April	30,	2018).

Subsidiaries	of	the	Registrant.

Consent	of	Ernst	&	Young	LLP,	Independent	Registered	Public	Accounting	Firm.

* Management	contract	or	compensatory	plan	or	arrangement.

†				Schedules	have	been	omitted	pursuant	to	Item	601(b)(2)	of	Regulation	S-K.	WestRock	hereby	undertakes	to	furnish	supplementally	copies	of	any of	the	omitted	schedules	upon	request	by	the	SEC.

@ 	Confidential	 treatment	has	been	requested	 for	certain	portions	omitted from this	exhibit	pursuant to	Rule	24b-2	under the	Exchange	Act. Confidential	portions	of	this	exhibit	have	been	separately	filed	with	the	SEC.

# P				Paper	filing.

^ In	accordance	with	SEC	Release	No.	33-8238,	Exhibit	32.1	is	to	be	treated	as	"accompanying"	this	report	rather	than	"filed"	as	part	of	the report.

# SIGNATURES

Pursuant	to	the	requirements	of	Section	13	or	15(d)	of	the	Exchange	Act,	the	Registrant	has	duly	caused	this	report	to	be	signed	on	its	behalf	by	the undersigned,	thereunto	duly	authorized.

Pursuant	to	the	requirements	of	the	Securities	Exchange	Act	of	1934,	this	Report	has	been	signed	below	by	the	following	persons	on	behalf	of	the Registrant	and	in	the	capacities	and	on	the	dates	indicated:

| Signature | Title | Date |
| :--- | :--- | :--- |
| /s/\tSTEVEN\tC.\tVOORHEES | \t Chief\tExecutive\tOfficer\tand\tPresident | November\t16,\t2018 |
| Steven\tC.\tVoorhees | (Principal\tExecutive\tOfficer),\tDirector |  |
| /s/\tWARD\tH.\tDICKSON | \t Executive\tVice\tPresident\tand\tChief\tFinancial\tOfficer | November\t16,\t2018 |
| Ward\tH.\tDickson | (Principal\tFinancial\tOfficer) |  |
| /s/\tKELLY\tC.\tJANZEN | \t Chief\tAccounting\tOfficer | November\t16,\t2018 |
| Kelly\tC.\tJanzen | (Principal\tAccounting\tOfficer) |  |
| /s/\tJOHN\tA.\tLUKE,\tJR.\nJohn\tA.\tLuke,\tJr. | \t Director,\tNon-Executive\tChairman\tof\tthe\tBoard | November\t16,\t2018 |
| /s/\tCOLLEEN\tF.\tARNOLD\nColleen\tF.\tArnold | \t Director | November\t16,\t2018 |
| /s/\tTIMOTHY\tJ.\tBERNLOHR\nTimothy\tJ.\tBernlohr | \t Director | November\t16,\t2018 |
| /s/\tJ.\tPOWELL\tBROWN\nJ.\tPowell\tBrown | \t Director | November\t16,\t2018 |
| /s/\tMICHAEL\tE.\tCAMPBELL\nMichael\tE.\tCampbell | \t Director | November\t16,\t2018 |
| /s/\tTERRELL\tK.\tCREWS\nTerrell\tK.\tCrews | \t Director | November\t16,\t2018 |
| /s/\tRUSSELL\tM.\tCURREY\nRussell\tM.\tCurrey | \t Director | November\t16,\t2018 |
| /s/\tGRACIA\tC.\tMARTORE\nGracia\tC.\tMartore | \t Director | November\t16,\t2018 |
| /s/\tJAMES\tE.\tNEVELS\nJames\tE.\tNevels | \t Director | November\t16,\t2018 |
| /s/\tTIMOTHY\tH.\tPOWERS\nTimothy\tH.\tPowers | \t Director | November\t16,\t2018 |
| /s/\tBETTINA\tM.\tWHYTE | \t Director | November\t16,\t2018 |



Question: what was the total balance in 2018 , if the company was to include interest and penalty liabilities?
Answer: the total balance in 2018 including interest and penalties would be $ 56.7 million .