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Notes to Consolidated Financial Statements

Note 1 – Summary of Significant Account Policies Note 2 – Segment Information Note 3 – Earnings Per Share Note 4 – Employee and Retiree Benefits Note 5 – Investments held by VEBA Trust Note 6 – Former Natural Resource Operations Note 7 – Costs Associated With Exit Activities Note 8 – Property and Equipment Note 9 – Impairment of Long-Lived Assets Note 10 – Other Assets Note 11 – Accrued Liabilities Note 12 – Other Liabilities Note 13 – Long-Term Debt Note 14 – Accounts Receivable and Asset Securitization Note 15 – Operating Leases Note 16 – Share-Based Compensation Plans Note 17 – Capital Stock Note 18 – Income Taxes Note 19 – Supplemental Cash Flow Information Note 20 – Other Operating Income, Net Note 21 – Other Nonoperating Income (Expense), Net Note 22 – Risk Management Note 23 – Other Commitments and Contingencies Note 24 – Selected Quarterly Financial Data (unaudited)

Note 24 – Selected Quarterly Financial Data (Unaudited)

		2004 Quarters						2003 Quarters
(In millions, except per share amounts)		1st	2nd	3rd	4th (a)			1st	2nd	3rd	4th (b)
Revenues	$	1,094.5	1,131.5	1,195.0	1,297.1		$	928.9	960.6	999.4	1,109.7
Operating profit		33.7	37.8	58.7	59.7			-	13.2	22.4	64.2
Income (loss) from:
Continuing operations	$	17.2	12.6	37.7	33.1		$	(3.2)	5.6	11.5	4.3
Discontinued operations		8.6	6.0	0.4	5.9			1.5	0.5	38.5	(29.3)
Net income (loss)	$	25.8	18.6	38.1	39.0		$	(1.7)	6.1	50.0	(25.0)
Net income (loss) per common share:
Basic:
Continuing operations	$	0.32	0.23	0.69	0.60		$	(0.06)	0.11	0.22	0.08
Discontinued operations		0.16	0.11	-	0.11			0.03	-	0.72	(0.55)
Basic	$	0.48	0.34	0.69	0.71		$	(0.03)	0.11	0.94	(0.47)
Diluted:
Continuing operations	$	0.32	0.23	0.68	0.59		$	(0.06)	0.11	0.22	0.08
Discontinued operations		0.15	0.11	-	0.11			0.03	-	0.72	(0.55)
Diluted	$	0.47	0.34	0.68	0.70		$	(0.03)	0.11	0.94	(0.47)
Dividends declared per common share	$	0.025	0.025	0.025	0.025		$	0.025	0.025	0.025	0.025
Stock prices:
High	$	28.38	34.47	34.29	39.91		$	18.81	16.40	18.25	23.34
Low		22.71	27.57	25.80	30.00			12.36	12.39	14.38	17.65

(a)

Income (loss) from discontinued operations in the fourth quarter of 2004 includes a $5.0 million pretax gain as a result of additional proceeds from the sale of a former coal operation, and $7.3 million of pretax income as a result of a decrease in the estimate of the Company’s obligation related to the withdrawal from coal-related multiemployer pension plans.

(b)

Income (loss) from continuing operations in the fourth quarter of 2003 includes $28.4 million of expense as a result of adjustments to deferred tax valuation allowances, net, and $10.4 million pretax gain on the sale of an investment in a gold and nickel interest. In addition, the quarter also includes expense of $5.4 million ($3.3 million for the full year) for adjustments related to a detailed analysis conducted by the Company of its current and deferred income tax assets and liabilities. Income (loss) from discontinued operations in the fourth quarter of 2003 includes pretax adjustments to the Health Benefit Act obligation ($31.3 million of expense) and withdrawal liability ($14.0 million of expense). The quarter also included pretax income related to a $5.3 million recovery of environmental costs and a $4.8 million gain on the sale of timber.

At December 31, 2004, approximately $291 million of stockholders’ equity was not available for dividends to shareholders due to limitations imposed by certain of the Company’s Revolving Facility and other lending arrangements (see note 13).

Earnings per share amounts for each quarter are required to be computed independently. As a result, their sum may not equal the annual earnings per share.

The Company’s quarterly financial data has been reclassified to reflect the Company’s natural gas, timber and gold as part of discontinued operations.

The Company’s common stock trades on the New York Stock Exchange as “BCO.” Prior to May 2003, the Company traded on the NYSE as “PZB.” As of March 1, 2005, there were approximately 2,768 shareholders of record of common stock.