504 Thrasher Street Norcross, Georgia 30071 RockTenn 770-448-2193 www.rocktenn.com NYSE: RKT 2011 Annual Report RockTenn provides superior paperboard and packaging solutions for consumer product companies at very low costs. We attract capable, highly motivated people who want to apply their talents to build a great company. We are committed to relentless performance and to: n Exceeding our customers’ expectations every time n Encouraging and rewarding employee excellence n Creating long-term shareholder value 2011 ANNUAL REPORT 1 Selected Financial Information 3 Letter to Shareholders 18 Board of Directors and Leadership Team 19 Form 10-K Shareholder Information A-1 Appendix – Non-GAAP Measures Inc. and Reconciliations IBC Shareholder Information Home Office Auditors Annual Meeting iative, 504 Thrasher Street Ernst & Young LLP Grand Hyatt Atlanta Init This annual report contains non-GAAP information. A reconciliation to comparable GAAP numbers can Norcross, Georgia 30071 55 Ivan Allen Jr. Boulevard 3300 Peachtree Road, NE stry 770-448-2193 Suite 1000 Atlanta, Georgia 30305 be found in the appendix of this annual report. rved. Fore Atlanta, Georgia 30308 Friday, January 27, 2012 at 9:00 a.m. rese Transfer Agent ts and Registrar Direct Deposit of Dividends Common Stock ainable righ FirstClass/Registered/CertifiedMail: RockTenn shareholders may have RockTenn common stock trades on All Sust of their quarterly cash dividends the New York Stock Exchange under Computershare Investor Services any. P.O. Box 43078 automatically deposited to checking, the symbol RKT. Comp savings or money market accounts emarks Providence, Rhode Island 02940 As of October 31, 2011, there were through the automatic clearinghouse trad RockTenn (NYSE:RKT) is CourierServices: approximately 3,378 shareholders of -Tenn system. If you wish to participate in Computershare Investor Services record of our Common Stock.* one of North America’s stered the program, please contact: Rock 250 Royall Street *Thenumberofshareholdersofrecord regi Computershare Trust Company, N.A. Canton, Massachusetts 02021 onlyincludesasingleshareholder,Cede leading integrated manu- 2011 800-568-3476 are &Co.,forallofthesharesheldbyour © www.computershare.com SFI shareholdersinindividualbrokerage facturers of corrugated Investor Relations accountsmaintainedatbanks,brokers LLC. and Investor Relations Department and consumer packaging andinstitutions. ices RockTenn 504 Thrasher Street Price Range of Common Stock Serv and recycling solutions. IATIVE Norcross, Georgia 30071 Fiscal 2011 Fiscal 2010 ncial INIT 678-291-7900 High Low High Low Fina Fax: 678-291-7903 ’s RockTenn has leading market STRY First Quarter $59.02 $49.23 $53.20 $42.18 Poor Second Quarter $74.26 $54.56 $52.59 $37.25 positions in each of its sustain- FORE & Third Quarter $78.64 $61.55 $55.90 $45.33 able packaging and recycling dard Fourth Quarter $67.98 $45.54 $55.22 $46.61 Stan businesses. RockTenn is AINABLE Stock Performance Graph of The graph below reflects cumulative shareholder return (assuming the reinvestment of dividends) on our Common Stock North America’s second largest SUST compared to the return on the S&P 500 Index, our New Industry Peer Group and our Old Industry Peer Group. This graph producer of containerboard, emarks represents the investment of $100 on September 30, 2006 in our Common Stock, the S&P 500 Index, our New Industry Peer trad idiaries. corrugated packaging, recycled Group and our Old Industry Peer Group and the reinvestment of dividends. In 2010, we used our Old Industry Peer Group, subs which is noted in the table and graph below; however, we have replaced it with our New Industry Peer Group, which we stered its paperboard and folding cartons, have set forth for all periods shown. Our New Industry Peer Group, which consists of certain companies included in our Old regi and Industry Peer Group, plus a number of other companies, consists of public companies that either compete directly in one or are and operates the largest paper any more of our product lines or are diversified, international manufacturing companies. We have modified our New Industry 500 recycling business. RockTenn’s Peer Group because it better reflects the size, geographic breadth and market capitalization of our Company. Comp S&P 26,000 employees are committed Comparison of 5-Year Cumulative Total Return* Among Rock-Tenn Company, the S&P 500 Index, an Old Peer Group 1 and a New Peer Group 2 and -Tenn to producing the best and most $300 400 Rock AP $250 of sustainable packaging available in $200 MIDC North America at very low costs emarks $150 S&P trad and exceeding their customers’ $100 A.C. $50 expectations – every time. stered 9/06 9/07 9/08 9/09 9/10 9/11 cil, regi $100investedon9/30/06instockandindex,includingreinvestmentofdividends.FiscalyearendingSeptember30.Cumulativetotalreturnisweightedaccording Coun are totherespectiveissuer’sstockmarketcapitalizationatthebeginningofeachperiodforwhichthereturnisindicated. nta -8 Atla Fiscal Year 9/06 9/07 9/08 9/09 9/10 9/11 / ardship TRAY eye Rock-Tenn Company $ 100.00 $ 147.90 $ 207.27 $ 246.99 $ 264.48 $261.92 Stew see st META S&P 500 100.00 116.44 90.85 84.58 93.17 94.24 see Fore and Old Peer Group 100.00 119.91 96.09 99.86 107.63 106.76 of VWA| “R” New Peer Group 100.00 124.37 93.59 83.19 86.75 84.61 by emark ized 1. Old Industry Peer Group includes Ball Corp., Bemis Company, Cascades, Inc., Crown Holdings Inc., Graphic Packaging Holding Company, trad uced styl Greif Inc., International Paper Company, MeadWestvaco Corporation, Owens-Illinois Inc., Packaging Corporation of America, Sealed Air Corp., the prod Silgan Holdings Inc., Sonoco Products Company and Temple-Inland Inc. 2. New Industry Peer Group includes Alcoa Incorporated, Ball Corp., Bemis Company, Crown Holdings Inc., Graphic Packaging Holding Company, and registered International Paper Company, Kimberly-Clark Corp., MeadWestvaco Corporation, Newell Rubbermaid Inc., Nucor Corp., Sonoco Products a is Company, Temple-Inland Inc., The Goodyear Tire & Rubber Co., United States Steel Corp. and Weyerhaeuser Company. Designed ROCKTENN, FSC © 2011 Standard & Poor’s, a division of The McGraw-Hill Companies Inc. All rights reserved. (www.researchdatagroup.com/S&P.htm) RockTenn | 2011 Annual Report Selected Financial Information Earnings Per Share Adjusted Earnings Per Share in dollars in dollars $5.71 $5.70 $5.50 $4.59 $4.43 $2.75 $2.77 $2.15 $2.05 $2.12 07 08 09 10 11 07 08 09 10 11 Free Cash Flow Credit Agreement EBITDA in millions of dollars in millions of dollars $1,349 $284 $266 $262 $160 $157 $579 $453 $526 $287 07 08 09 10 11 07 08 09 10 11 1 RockTenn Delivers Total Shareholder Return 1999-2011 Outstanding Financial Year Ended September 30 Returns 350% RockTenn’s total shareholder 327.4% return over the 12 years ended September 30, 2011 was 300% 327%, far outpacing the returns of major U.S. stock market indi- 250% ces. RockTenn delivers these returns by disciplined adher- ence to its business model 200% focused on generating strong cash flows through investing 139.2% 150% for competitive advantage, optimizing economies of scale, continuously improving all of 100% its processes and seeking 40.7% acquisitions that improve its 50% assets and business profile. 9.7% 0% S&P 500 BUSPACK* S&P Midcap 400 RockTenn Index Index Index *BloombergAmericasPackaging&ContainersIndex 2 RockTenn | 2011 Annual Report Dear Shareholders: With the acquisition of Smurfit-Stone, there are two parts James A. Rubright of fiscal 2011 that merit reporting in this letter – the eight Chairman and Chief Executive Officer months prior to the acquisition and the four months following the May 27 closing of the acquisition. For the first part of the year, RockTenn performed as our shareholders have come to expect. In short, we performed very well in a period of rising recycled fiber and chemical costs. For the first six months of the year, RockTenn earned a 14% annualized free cash flow return on beginning market equity, slightly lower than the return we earned in all of fiscal 2010. Our corrugated packaging segment earned a 22.3% EBITDA margin, once again the highest of any publicly reported company in our industry, and about 18% higher than our next closest competitors. For the full year, in our consumer 3 RockTenn’s Corrugated Packaging and Recycling Leadership Team With the acquisition of Smurfit-Stone in May 2011, RockTenn acquired 12 containerboard mills with 7 million tons of total annual capacity, 98 converting plants and 31 recycling facilities. These facilities are led by an experienced team well respected in the industry. Pictured here are (clockwise from top left): Mike Exner, Senior Vice President and General Manager, Containerboard Mills; Matt Denton, Senior Vice President, Finance; Mike Oswald, Senior Vice President and General Manager, Recycling and Waste Solutions; Steve Strickland, Senior Vice President and General Manager, Corrugated Container; and Jim Porter, President, 1. Corrugated Packaging and Recycling. 1. Hodge, LA, mill’s 355-inch wide linerboard machine. 2. RockTenn’s LaTuque, QC, mill produces the industry’s favored white top linerboard. 3. RockTenn’s Corrugated Packaging and Recycling Leadership Team. 4. RockTenn’s Fernandina Beach, FL, Kraft linerboard mill. 3. 4. 4 RockTenn | 2011 Annual Report packaging business, we increased folding carton sales by 2.2% in an industry that reported volume declines of 2.8%. Our merchandising display business also restarted sales growth as our customers’ renewed focus on promotional 2. displays and the cost reductions we had achieved over the last two years enhanced our competitive position and main- tained our margins. In our view, RockTenn’s 2011 GAAP earnings per share of $2.77 represent a remarkable achievement given the accounting treatment of acquisitions, which requires acquired inventory write ups, transaction fee expensing, the write down of assets that we knew we’d close but were required to write up on the opening balance sheet, among others, and the head- winds we faced with rising input costs for fiber, chemicals, energy and freight.