MEADWESTVACO%20%20Goldman%20Sachs%2012TH%20Annual%20Cyclicals%20

1
MEADWESTVACO Goldman Sachs12TH Annual
Cyclicals Specialty Materials ForumJohn A.
Luke, Jr. Chairman, CEOMay 19, 2004
2
MEADWESTVACO OVERVIEW

• Global provider of products and services across
  four lines of business

• Packaging
• Coated Specialty Papers
• Consumer Office Products
• Specialty Chemicals

AUTOMOTIVE
COSMETICS
BEVERAGE
FOOD DAIRY
MEDIA
PHARMACEUTICALS
PUBLISHING
SCHOOL OFFICE SUPPLIES
3
MEADWESTVACO
2003 Sales 7.6BN
Papers
2.1 BN
Packaging
4.0 BN
1.1 BN
Consumer Office Products
.4 BN Specialty Chemicals
4
CREATING VALUE THROUGH PROFITABLE GROWTH
5
ACHIEVING PROFITABLE GROWTH
Goals

• Industry-leading total shareholder return
• Returns above Cost of Capital
• Strong cash flow generation
• Improved Debt to Total Capital ratio
• Strong dividend

6
CURRENT POSITION
Responses
Challenges

• Synergy capture
• Productivity initiative
• Non-strategic asset sales
• Fiscal discipline

• Financial performance
• Economic market conditions
• Merger costs

7
DRIVING BETTER PERFORMANCE SIGNPOSTS OF PROGRESS

• 382MM firm foundation
• Greater visibility

• Quarterly updates
• 2005 goal of 500MM working capital, earnings

• Continued forestland sales
• Non-core asset sales

• Price
• Volume

• New products and mix
• Strategic growth

8
SYNERGY SAVINGS ARE REAL BUT MASKED BY MARKETS,
OTHER ITEMS

Price/mix decline in 02-03, primarily in Papers
9
PRODUCTIVITY INITIATIVE
Goal 500MM by 2005
Earnings 250MM Cost Mix Volume
Cash flow 250MM Working capital Capital
spending Asset rationalization
Progress First quarter 2004
35MM 400 FTEs
30MM 0.5 of sales Reduced inventory build
See reconciliation in appendix
10
ASSET MANAGEMENT

• Forestland sales
• 2002 proceeds of 134MM
• 2003 proceeds of 281MM
• 2004 est. proceeds 150MM to 200MM
• Other asset divestitures
• U.K. specialty paper mill
• U.S. panelboard plant

11
DEMAND

• Improved coated paper volume and pricing
• Improved paperboard volume and price
• Continuing growth in Consumer Packaging
• Media and entertainment
• Pharmaceuticals and healthcare
• Personal care products
• Strong Consumer Office Products and Specialty
  Chemicals markets

12
PROFITABLE GROWTH

• Leveraging our current platform
• Product mix improvement
• Value-based product and service innovation to
  support growth in each business
• Focused initiatives
• Strategic growth in attractive, expanding global
  markets

13
DRIVING BETTER PERFORMANCE SIGNPOSTS OF PROGRESS

• 382MM firm foundation
• Greater visibility

• Quarterly updates
• 2005 goal of 500MM working capital, earnings

• Continued forestland sales
• Non-core asset sales

• Price
• Volume

• New products and mix
• Strategic growth

8.5 ROIC
Current Returns
14
PACKAGING
2003 Sales 4 BN Segment Profit 267MM
Consumer Packaging Packaging Systems Markets
Business breakdown
High Quality Paperboard
Beverage Dairy
Media Entertainment
25
45
Pharmaceutical Healthcare
5
25
Beauty, Luxury General Consumer
Consumer Packaging Packaging Systems
15
GLOBAL LEADER IN HIGH-QUALITY PAPERBOARD
PACKAGING
1 in high-quality paperboard worldwide

• Coated Natural Kraft - 2 CNK worldwide
• 1.0MM tons per year from Mahrt, AL

• Bleached board - 2 SBS worldwide
• 1.7MM tons per year from Covington, VA
  Evadale, TX

Source Jaakko Poyry and MeadWestvaco analysis
16
GLOBAL MARKET POSITIONS
17
FOCUS ON KEY PACKAGING MARKETS

• Focused on growing markets that value innovative,
  specialty packaging and systems

Consumer Goods
Media
Beverage
Healthcare
Growth
20
4-6
3-6
2-4
Digipak system
FridgeMaster Duralift
Surepak Dosepak
Klearfold Vista
Expected growth rates are based on 2002 Boston
Consulting Group study.
18
VALUE AS CUSTOMERS SEE IT
Delivering value from the customers point of
view
19
CREATING SUSTAINABLE VALUE
PACKAGING HIGHLIGHTS
Products that provide competitive advantage for
customers

• FridgeMaster beverage packaging
• Digi franchise for audio and video packaging
• DosePak for compliance health care packaging
• CNK paperboard Printkote bleached board

20
PAPERS
2003 Sales 2.1 BN
Segment loss (46) MM
Sales by Market
Commercial Print
Books/C1S
Catalogs
Magazine
21
CREATING SUSTAINABLE VALUE
COATED PAPERS HIGHLIGHTS
Highly efficient mills, stand-out customer
service and quality products

• Optimization of mill manufacturing platform
• Complete product offering, broad distribution
• Excellent information systems

22
CONSUMER OFFICE PRODUCTS
2003 Sales 1.1 BN Segment
profit 126MM
23
CREATING SUSTAINABLE VALUE
CONSUMER OFFICE PRODUCTS - HIGHLIGHTS
Strong brand names, enhanced market positions
through targeted acquisitions and continual
improvements to our products and services

• 20 year anniversary of the Five Star product
  line
• Successful integration of AMCAL and Day Runner
• Launch of integrated envelope e-commerce and
  order-entry system

24
SPECIALTY CHEMICALS
2003 Sales .4 BN
Segment profit 45MM
Product Profile
Carbon - Automotive - Catalyst corrosion
technology - Food pharmaceuticals
Specialty products - Gravure inks - Litho inks
- Rubber - Paper chemicals - Petroleum
Polychemicals - Agrichemicals - Asphalt -
Dyestuffs
25
CREATING SUSTAINABLE VALUE
SPECIALTY CHEMICALS - HIGHLIGHTS
Innovative inputs that enhance our customers
products

• Strategic relationships to enhance emulsification
  business and extend customer base
• Carbon products that improve emissions in a
  majority of automobiles on the road
• Inputs that create high-gloss, durable paints
  that are clean-up friendly and lower in odor

26
MARKET OUTLOOK

• Demand improved in Q1 order backlogs increased
  in many markets
• Growth continues in our converted packaging
  markets
• Improved operations at our mill-based paperboard
  business
• Price increases for pulp, uncoated paper,
  linerboard, carbonless paper, bleached board
• Coated paper
• Strong orders, gaining share
• Customers on allocation, price increase announced

27
CREATING VALUE

• Pursuing productivity and profitable growth
• Carefully managing our assets
• Driving for financial goals
• Industry-leading total shareholder return
• Returns above cost of capital
• Strong cash flow generation
• Strong dividend to shareowners
• Debt to total capital lt 40

28
FORWARD-LOOKING STATEMENTS

• Certain statements in this document and elsewhere
  by management of the company that are neither
  reported financial results nor other historical
  information are "forward-looking statements"
  within the meaning of the Private Securities
  Litigation Reform Act of 1995. Such information
  includes, without limitation, the business
  outlook, assessment of market conditions,
  anticipated financial and operating results,
  strategies, future plans, contingencies and
  contemplated transactions of the company. Such
  forward-looking statements are not guarantees of
  future performance and are subject to known and
  unknown risks, uncertainties and other factors
  which may cause or contribute to actual results
  of company operations, or the performance or
  achievements of each company, or industry
  results, to differ materially from those
  expressed or implied by the forward-looking
  statements. In addition to any such risks,
  uncertainties and other factors discussed
  elsewhere herein, risks, uncertainties and other
  factors that could cause or contribute to actual
  results differing materially from those expressed
  or implied for the forward-looking statements
  include, but are not limited to, events or
  circumstances which affect the ability of
  MeadWestvaco to realize improvements in operating
  earnings and cash flow expected from the
  company's productivity initiative competitive
  pricing for the company's products changes in
  raw materials pricing energy and other costs
  fluctuations in demand and changes in production
  capacities changes to economic growth in the
  United States and international economies
  government policies and regulations, including,
  but not limited to those affecting the
  environment and the tobacco industry adverse
  results in current or future litigation, currency
  movements and other risk factors. MeadWestvaco
  undertakes no obligation to publicly update any
  forward-looking statement, whether as a result of
  new information, future events or otherwise.
  Investors are advised, however, to consult any
  further disclosures made on related subjects in
  the company's reports filed with the SEC.

29
MEADWESTVACO Goldman Sachs12TH Annual
Cyclicals Specialty Materials ForumJohn A.
Luke, Jr. Chairman, CEOMay 19, 2004
30
APPENDIX
31
WORKING CAPITAL PRODUCTIVITY INITIATIVE -
DEFINITIONS

• Net operating working capital (NOWC) is defined
  as accounts receivable plus inventory, minus
  accounts payable
• Reduction in NOWC is measured as a percent of
  sales, against 2003 sales levels. NOWC accounts
  are measured as the average of beginning and
  ending balance, a 2-point average, to accommodate
  for seasonality
• The calculation of sales, in the percent of sales
  calculation, is annualized quarterly sales for
  the quarter being measured
• NOWC is a supplemental measure of our
  productivity initiative utilizing the above
  working capital items because they are more
  directly associated with factors that our
  businesses can influence through payment terms
  and other methods.
• Measuring NOWC productivity in terms of 2003
  sales allows for the increase in NOWC necessary
  to support sales growth

32
WORKING CAPITAL PRODUCTIVITY INITIATIVE Key Data
( Millions)