1. S M U R F I T - S TO N E C O N TA I N E R C O R P O R AT I O N
2005 ANNUAL REPORT
05 *

2. Financial Highlights
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) 2005 2004 2003
Summary of Operations
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,396 $ 8,291 $ 7,722
Net loss available to common stockholders . . . . . . . . . . . . . . (339) (57) (208)
Basic and Diluted Earnings per Share
Net loss available to common stockholders . . . . . . . . . . . . . . $ (1.33) $ (.23) $ (.85)
Weighted average shares outstanding (in millions) . . . . . . . . 255 253 246
Other Financial Data
Net cash provided by operating activities . . . . . . . . . . . . . . . . $ 221 $ 273 $ 162
Capital investments and acquisitions . . . . . . . . . . . . . . . . . . . 285 232 238
Working capital, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) 148 136
Property, plant, equipment and timberland, net . . . . . . . . . . . 4,289 4,682 4,974
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,114 9,583 9,956
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,571 4,498 4,807
Stockholders’ equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,882 2,259 2,270
Number of employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,500 35,300 36,700
Company Profile
Smurfit-Stone Container Corporation (Nasdaq: SSCC) is the industry’s leading integrated manufacturer of
paperboard and paper-based packaging. Smurfit-Stone is a leading producer of containerboard, including
white top linerboard and recycled medium; corrugated containers; point-of-purchase displays; multiwall
and specialty bags; and clay-coated recycled boxboard; and is one of the world’s largest collectors and
marketers of recovered fiber. In addition, Smurfit-Stone is a leading producer of solid bleached sulfate,
folding cartons, flexible packaging, and labels. The company operates approximately 240 facilities,
located primarily in the U.S., Canada and Mexico, and employs approximately 33,500 people.

3. Smurfit-Stone
Container Corporation
2005 Annual Report
Strategies and Goals
* In 2005, Smurfit-Stone launched bold, strategic
initiatives designed to lower costs, drive revenue
growth, and implement a new organizational
structure that better leverages our position as North America’s
largest paperboard and packaging company.
Smurfit-Stone’s strategies and goals include:
Lowering our cost profile to improve operating margins,
create a more competitive manufacturing system, and
sustain a leading market position.
Expanding our service offerings and developing strategic
partnerships to help drive sales growth through innovation.
Implementing a new organizational structure to drive
our cost and revenue objectives.
Creating greater financial flexibility and delivering improved
value to our stockholders.
Goals and Timeline
(IN MILLIONS, COMPARED TO 2005) 2006 2007 2008
Annual cost-savings targets $280 $480 $600
Revenue growth above market $100 $325 $650
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4. Letter to Stockholders
Fellow Stockholders: 2008. In 2005, we made the following major
organizational changes.
Smurfit-Stone redefined its strategy in 2005 to
improve our position as the industry’s leading We realigned the executive management
paperboard and packaging provider. The results team to include a chief operating officer
of our strategic reassessment, announced in the and named veteran Smurfit-Stone executive
fourth quarter, are designed to make the most John Riconosciuto to that position.
effective use of our resources in a marketplace
that continues to undergo extensive change. We reorganized the management structure
in our corrugated container division to more
A significant portion of the industry’s traditional effectively take advantage of our integrated
customer base has moved manufacturing business model, separating the sales and
operations offshore, taking along major product marketing functions from manufacturing.
segments of the box market. The domestic This approach allows us to deploy our assets
retail environment has come to be dominated on an enterprise-wide basis to better meet
by mega-retailers, who are using their influence our customers’ needs.
to drive private label growth, and large consumer
products manufacturers. Leveraging our Emphasizing our commitment to meeting
strengths for these market realities demands the cost-savings and revenue-growth goals,
a more centralized and functionally focused we established an initiatives management
organization, unrelenting emphasis on organization, reporting to me, focused on
cost-effective operations, and new sales and driving the strategic initiatives.
marketing approaches to help fuel growth.
2005 Results
The continuing commoditization of packaging, Sales of $8.4 billion were up slightly from the
pricing pressures, and cost inflation led us to previous year’s $8.3 billion. For the full year,
systematically reassess our business model. Smurfit-Stone reported a net loss available to
We recognized that despite the company’s capa- common stockholders of $339 million, or
bilities, the structure we had in place could not $1.33 per diluted share, compared with 2004’s
take full advantage of our potential in the new net loss of $57 million, or $0.23 per diluted
market environment. To capitalize on evolving share. The 2005 results included $321 million
market opportunities, we are implementing a in restructuring charges related to closures
series of strategic initiatives to optimize our of mills and packaging facilities.
system and redesign our operating structure.
Until the market for containerboard and corru-
This is a three-year plan designed to deliver cost gated containers began to improve late in the
savings and revenue growth, with the full benefit year, demand fell short of expectations for most
of the strategic initiatives realized by the end of of 2005, causing prices to trend down. Cost
increases, including energy, freight, and fiber
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5. Smurfit-Stone
Container Corporation
2005 Annual Report
“Smurfit-Stone’s challenge now is to better align the size and
scope of our converting operations with today’s market.
Lowering our cost structure is the first priority. Our target is
to produce annual cost savings of $600 million by 2008.”
Patrick J. Moore
Chairman, President, and
Chief Executive Officer
offset the improvement from better mix a self-service environment that has led to
and pricing. a dramatic increase in the importance of
packaging’s point-of-purchase appeal.
Market-Driven Decisions
The determination and urgency we have brought Smurfit-Stone responded with stronger,
to our strategic initiatives is motivated by the lighter weight packaging, and developed
dramatic shift in the packaging market. hybrid packaging that combined the traditional
strength of corrugated with high-end graphics
As American manufacturers moved production appeal. We expanded our offering of white top
offshore, they also sourced their packaging linerboard, which provides the best substrate
requirements offshore. We saw the big-box for printing colorful, attention-getting packaging
retailers increasingly pushing their influence graphics. Our strategic plan continues this
further along the supply chain in their persistent evolution and further enhances our ability to
focus on driving costs out of production and capitalize on market trends.
distribution. These trends resulted in reduced
domestic packaging demand. At the same time,
domestic retail markets were emphasizing
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6. Redefining
the packaging
experience
Smurfit-Stone’s EnviroShell™
package combines brand and
environmental awareness.
EnviroShell™ is packaging that
enhances the appeal of our
customers’ environmentally
friendly products. EnviroShell™
is adaptable to specialty printing
while eliminating the glare
caused by more traditional
plastic clamshell packaging,
giving products more shelf
appeal at retail. EnviroShell™
is made from 65 percent
recycled material and is easy
to separate for disposal and
recycling purposes.
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7. Smurfit-Stone
Container Corporation
2005 Annual Report
Lowering the Cost Structure division organization by separating the sales
Smurfit-Stone’s challenge now is to better align from the manufacturing teams. As a result,
the size and scope of our converting operations our production managers now are focused on
with today’s market. Lowering our cost structure producing packaging at the lowest possible cost
is the first priority. Our target is to produce annual while still providing exceptional solutions and
cost savings of $600 million by 2008, compared to services to our customers.
2005 when we launched our strategic initiatives.
Driving improved productivity in our corrugated
In August, we eliminated an additional 700,000 container operations started with a rigorous
tons of capacity by closing two high-cost mills “best in class” assessment which focused on
in Canada and permanently closing one of three addressing gaps between optimum and actual
paper machines at our Fernandina Beach, Florida, performance and configuration at each site,
mill. These steps brought our mill system in based on the reassessment findings. We identi-
balance with current market demand. There fied many opportunities including eliminating
are additional mill savings still to be achieved redundant machinery, improving labor efficiency,
through productivity initiatives such as energy and making select capital investments to
reduction programs and further staff optimization. increase the productivity of key assets. The
corrugated container business is very scale
In our corrugated container system, we are sensitive. We plan to establish high-volume
improving productivity and increasing facility plants in a number of strategic geographic
scale to bring our overall cost profile in line markets to further reduce our cost profile
with our best performing plants. To support through economies of scale, investment in
this, we restructured our corrugated container high-speed corrugators, improved specialization,
Private label partners
Smurfit-Stone helped Office Depot launch a new
branding strategy for its private label products
that included an updated graphic look for the
company, and included approximately 5,000 items.
Smurfit-Stone is well known as the industry’s
premier packaging producer. Smurfit-Stone helps
customers brand their products, with a network
of service partners, offering merchandising
solutions to retailers and consumer packaging
goods companies.
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8. Investing in the future
Smurfit-Stone opened a new corrugated
container manufacturing facility in Milton,
Ontario, in 2005. The plant, showing a view
from the control room, is equipped with
a state-of-the-art corrugator that produces
a consistent, high-quality product and
can rapidly manufacture several different
flutes with very short setup times. The
250,000-square-foot facility well positions
Smurfit-Stone to serve the expanding
Ontario and northeastern U.S. markets.

10. Smurfit-Stone
Container Corporation
2005 Annual Report
RecyclaCorr™ is safe for
direct and indirect food
contact and is recyclable
Smurfit-Stone’s RecyclaCorr™ wax replacement
medium leads the way in an emerging market. Wax
frequently is used to provide boxes with additional
strength when they are exposed directly to water
or placed in a humid environment. Waxed packaging
is troublesome in the retail supply chain because
waxed board cannot be recycled, thus driving up
retailers’ disposal and labor costs. Smurfit-Stone’s
RecyclaCorr™ is safe for direct and indirect food
contact and is compliant with recyclability
requirements adopted by the American Forest &
Paper Association. The product is manufactured
at the company’s West Point, Virginia, mill.
and closure of smaller, outdated facilities. Capital investment is required to achieve our
Collectively, our productivity and scaling cost reduction targets. Smurfit-Stone anticipates
efforts could lead to the rationalization of spending $300 to $400 million in additional
up to 20 percent of our corrugated container capital by 2008 to drive a lower cost profile
plants over the next three years. through energy reduction programs, improving
the productivity of existing corrugating and
Significant opportunities exist to improve the converting equipment, and investing in larger,
integration between our mill and corrugated scaled facilities.
container systems. We have a number of initia-
tives to reduce our overall system costs while Revenue Growth
maintaining the performance specifications of Just as important as lowering our cost profile
the finished box. These efforts are reducing is our ability to serve and win customers who
the number of grade combinations, roll sizes, require value-added products and services.
inventory levels, and waste, as well as improving In the past, we focused our sales and marketing
mill productivity. Additional efforts will focus efforts on leveraging the widest packaging
on better leveraging our purchasing spend with product array and our strong geographic
our suppliers, centralizing our transportation coverage in North America. In addition to this,
management process and various administrative we will now focus our attention on promising
functions currently performed at the plant level. target markets — new and existing customers in
segments that exhibit attractive growth potential
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11. Smurfit-Stone
Container Corporation
2005 Annual Report
and who require value-added packaging services. now channeled through those retailers. Often,
We will employ many tools, including innovative these customers operate on a global scale,
packaging solutions tailored to address changing requiring Smurfit-Stone to further expand its
packaging needs, our unique “agency service” reach beyond North America.
approach to deliver a wider complement of
products and services, and leveraging a Our Innovation to Implementation (i2i) concept
more cost-competitive operation to improve incorporates the “agency service” model. This
margins and open new markets previously allows Smurfit-Stone to serve as our customer’s
considered unattractive. agent in obtaining branding and related services
to provide fresh approaches to customers’
As with our cost initiatives, separating our packaging challenges. We are building strategic
corrugated container organization between sales alliances to provide these offerings. One of our
and manufacturing teams is the first step to partners is Daymon Worldwide, a private-label
drive profitable revenue growth. Instead of each brand management and market research firm.
plant having a sales force working on behalf We formed a joint venture with Winterborne, Inc.,
of the individual plant, sales teams report into to help address packaging needs with hybrid
a central sales organization with units focused paper and plastic solutions. In Asia, we have
on local, regional and national accounts, as well joint ventures in place with Pacific Millennium
as key targeted segments. This change allows and Hang Yick, broadening our relationships
us to remain focused on improving revenue with our North American customers who source
growth and assigning the right resources to products domestically and in Asia, and who
the best opportunities. benefit from a globally coordinated branding,
packaging design, and fulfillment process.
We will achieve growth by targeting key markets
such as protein, frozen specialty foods, and Many of our customers continue to have tradi-
pharmaceuticals, and similar high-growth tional packaging requirements. We will leverage
potential markets. With specific teams focused our low-cost converting and mill operations to
on attractive market segments, we will better improve our margins in these segments.
understand our customers’ needs. This focus
will allow us to continue to deliver innovative Financial Flexibility
RecyclaCorr™ EnviroShell™
products such as and , As part of our strategic reassessment, we
and our META™ and Value Proposition Solutions evaluated each of our business segments for
(VPS) packaging systems. strategic fit as well as prospects for growth and
margin improvement. We are working with a
We will create opportunities from the point-of- financial advisor to explore selling some or
purchase retail environment and the growing all of our consumer packaging business in order
influence of private labels. This applies to retailers to focus our resources on the containerboard
interested in extending their private label lines and corrugated container businesses.
as well as manufacturers whose products are
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12. Smurfit-Stone
Container Corporation
2005 Annual Report
“We will create opportunities from
the point-of-purchase retail environment and
the growing influence of private labels.”
Proceeds from any asset sales will be used ment utilized by the Occupational Safety and
to pay down debt. The pressure on financial Health Administration (OSHA).
performance from high energy costs, disruptions
in wood fiber supplies, and fiercely competitive Creating Value
markets inhibited our financial flexibility and We began 2006 on an encouraging note. Year-
stalled our deleveraging initiatives. Paying end inventories were at their lowest levels in
down debt remains our top financial priority, 10 years. Our mills and packaging plants were
and the strategic initiatives are designed to help running at high utilization levels. We are well
achieve that goal. positioned in the near term to benefit from an
improving price environment.
Safety
While Smurfit-Stone has initiated changes to The initiatives in place are beginning to deliver
the way we conduct our business, one area that the intended benefits. We have a timeline in place
remains unchanged is our unwavering commit- to accomplish far-reaching changes. We have
ment to safety as the company’s top operating begun to put the organizational structure in
priority. A core value of our CustomerONE® place to execute the plan. And, we have taken
operating philosophy, safety at all of our the critical steps to assess each component
facilities embraces five key beliefs: of the organization and realign operations as
needed. We must improve the returns on
All injuries are preventable;
Smurfit-Stone’s resources to make the
Safety is everyone’s responsibility; company an increasingly valuable investment
for customers, employees, and stockholders.
Working safely is a condition of employment;
Training employees to work safely
is essential; and,
Safety is good business.
Smurfit-Stone’s 1.16 domestic recordable case Patrick J. Moore
rate (RCR) in 2005 was the best in company Chairman, President, and Chief Executive Officer
history and led our industry, according to
preliminary data made available by the
Pulp & Paper Safety Association, a major
trade organization. RCR is the major measure-
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13. Growing our presence in key markets
Smurfit-Stone’s META™ and Value Proposition Solution strength with boxes up to eight sides, which also
(VPS) packaging systems are part of a broader growth provides high-impact merchandising capabilities.
strategy that provides value beyond the package. META™ META™ packaging equipment provides high-speed
and VPS are proprietary packaging systems that provide auto-erect capabilities up to 65 cases a minute with
customers with a unique way to differentiate their quick changeovers and flexibility.
packaging, while adding value to their marketing mix. VPS boxes, such as the Ocean Mist salad spinach
META™ and VPS target U.S. meat and produce markets, package, are designed to maximize packaging strength
respectively, segments which have demonstrated while minimizing material use, all in a one piece design.
growth and stability. VPS packaging equipment provides versatility on the
Among their many benefits, META™ boxes, such as manufacturing line, and the superior strength of VPS
the Boar’s Head package, offer improved stacking designs maximizes customers’ packaging graphics.
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14. Smurfit-Stone
Container Corporation
2005 Annual Report
Board of Directors
Patrick J. Moore Alan E. Goldberg Jerry K. Pearlman Chairman Emeritus
Chairman, President Co-Managing Partner Retired Chairman Dr. Michael W.J. Smurfit
and Chief Executive Officer Lindsay Goldberg & and CEO
Smurfit-Stone Container Bessemer GP LLC Zenith Electronics
Corporation William T. Lynch, Jr. Thomas A. Reynolds, III
James R. Boris Retired President and CEO Partner
Retired Leo Burnett Company Winston & Strawn LLP
Chairman and CEO James J. O’Connor Eugene C. Sit
EVEREN Securities, Inc. Retired Chairman and CEO Chairman, CEO,
Connie K. Duckworth UNICOM and Chief Investment Officer
Founding Partner Commonwealth Edison Sit Investment Associates
8Wings Enterprises, LLC William D. Smithburg
Retired Chairman,
President and CEO
The Quaker Oats Company
Corporate Officers
Patrick J. Moore Craig A. Hunt Mark R. O’Bryan Mathew J. Blanchard
Chairman, President Senior Vice President Senior Vice President Vice President
and Chief Executive Officer Secretary Strategic Initiatives and General Manager
and General Counsel Board Sales
John M. Riconosciuto Michael R. Oswald
Chief Operating Officer M.C. (Sonny) Jackson Senior Vice President Cynthia S. Bowers
Senior Vice President and General Manager Vice President
Charles A. Hinrichs
and General Manager Recycling Division Compensation, Benefits
Senior Vice President
Containerboard Mill Division and HR Services
and Chief Financial Officer Thomas A. Pagano
Paul K. Kaufmann Senior Vice President Regina G. (Jean) Wyse
James E. Burdiss
Senior Vice President and Corporate Development Vice President
Senior Vice President and
Corporate Controller Enterprise Process
Chief Information Officer Curtis A. Barton
Integration
John L. Knudsen Vice President
James D. Duncan
Senior Vice President Environmental Affairs Ronald J. Megna
Senior Vice President
Manufacturing Assistant Secretary
Sales and Marketing Roger P. Becker
Corrugated Container Vice President
Daniel J. Garand Division Taxes
Senior Vice President
Timothy J. P. McKenna
Supply Chain Management Jeffrey S. Beyersdorfer
Senior Vice President Vice President and
Ronald D. Hackney Investor Relations Treasurer
Senior Vice President and Communications
Human Resources
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15. Smurfit-Stone
Container Corporation
2005 Annual Report
Division Officers
Corrugated Container Containerboard Mill Consumer Packaging Thomas J. Pastorino
Vice President
Division Division Division
and Regional General Manager
Daniel J. Burger Alain L.M. Boivin Curtiss M. Komen Folding Cartons
Vice President Vice President Senior Vice President
David J. Pietrowicz
Strategic Planning Mill Operations Sales
Vice President
Northern Region
John P. Crimmin John P. Antonucci and General Manager
Larry L. Burton
Regional Vice President Vice President Folding Cartons
Sales Vice President Sales and Marketing
Michael L. Weisheit
Sales and Marketing Label Products
Richard E. Flamm Vice President
Michael L. Butler Edward A. Byczynski
Regional Vice President Strategic Initiatives
Manufacturing Vice President Vice President Folding Cartons
Containerboard Sales and General Manager
James A. Henderson
Bag Packaging Group
James S. Chou Recycling
Regional Vice President
Jeffrey Deitch
Manufacturing Vice President Division
and Division Controller Vice President
Stephen E. Jevyak Mark C. Brantley
Technology
John E. Davis
Regional Vice President Vice President
Flexible Packaging Group
Sales Vice President Eastern Region
Michael L. Hempstead
Forest Resources
George Q. Langstaff Robert J. Curran
Vice President
Roger M. Jansen
Vice President Vice President
Sales and Product Development
Operational Excellence Vice President Business Development
Folding Cartons
SBS Sales
Robert A. Miller Delmar C. Jones
Nathan S. Holmes
Larry T. Price
Vice President Vice President
Vice President
International Sales Vice President Western Region
and General Manager
and Marketing Mill Operations
Boxboard Mills and Lamination James W. Pope
Rodney A. Myers Eve K. Rae Vice President
Gary R. Huston
Regional Vice President Vice President International Sales
Vice President
Manufacturing Pulp Sales
Sales Tom E. Squires
Robert D. Nelson W. G. Stuart Boxboard Mills Vice President
Regional Vice President Vice President Operational Excellence
James B. Laurence
Sales Mill Operations
Vice President of Sales Edward V. Tucciarone
Southern Region
James S. Nolan Bag Packaging Group Vice President
Andrew J. Woodroffe
Vice President Domestic Sales
Robert E. Lewis
Corporate Sales, Strategic Vice President
Vice President
Merchandising Solutions Product Management and Other
and Regional Manager
and Graphics Technical Services
Folding Cartons
John J. Caplice
Donald A. Petri Donald C. Wyatt Vice President
Fred W. Klatt
Vice President and Vice President Corporate Accounts
Vice President
General Manager Kraft Sales and
and Regional Manager
David F. Koster
Specialty/Hybrid Plants National Accounts
Bag Packaging Group
Vice President
Thomas A. Piggott Transportation and Distribution
Kenneth E. Kushibab
Regional Vice President
Vice President
Joseph V. LeBlanc
Sales
and Division Controller
Vice President
E. Lawrence Quatmann Research and Development
Donald W. McCalla
Vice President
Vice President
Mark A. Polivka
and Division Controller
Marketing
Vice President
Donald Roy Procurement
Gary D. McDaniel
Regional Vice President
Vice President
William C. Wanner
Sales
and General Manager
Vice President
Stephen J. Strang Flexible Packaging and Labels
Supply/Demand Operations
Vice President
John J. Moran
and General Manager
Vice President
Smurfit MBI
Strategic Services
John Yoder
Regional Vice President
Manufacturing
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16. Smurfit-Stone
Container Corporation
2005 Annual Report
Stockholder Information
Stockholders’ Annual Meeting Investor Information
May 10, 2006 at 11 a.m. Investor Relations and Communications
University of Chicago Smurfit-Stone Container Corporation
Gleacher Center 8182 Maryland Avenue
450 N. Cityfront Plaza Drive St. Louis, MO 63105
Chicago, IL 60611
Telephone: (314) 746-1223
Registrar and Transfer Agent Fax: (314) 746-1347
Mellon Investor Services LLC www.smurfit-stone.com
480 Washington Boulevard
Jersey City, NJ 07310-1900 Timothy McKenna
(800) 676-0896 Senior Vice President,
Investor Relations and Communications
TDD for Hearing Impaired: (800) 231-5469 Chicago: (312) 580-4637
Foreign Stockholders: (201) 680-6578 St. Louis: (314) 746-1254
TDD Foreign Stockholders: (201) 680-6610
Corporate Headquarters
www.melloninvestor.com/isd Smurfit-Stone Container Corporation
150 North Michigan Avenue
Common Stock Chicago, IL 60601
Smurfit-Stone Container Corporation Common Telephone: (312) 346-6600
Stock is traded on The Nasdaq National Market
under the symbol: SSCC
Preferred Stock
Smurfit-Stone’s 7% Series A Cumulative
Exchangeable Redeemable Convertible
Preferred Stock is traded on Nasdaq under
the symbol: SSCCP
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18. 150 NORTH MICHIGAN AVENUE
CHICAGO, IL 60601-7568
(312) 346-6600
WWW.SMURFIT-STONE.COM