presentation - 10th annual itau bba latam ceo conference

8/9/2019 Presentation - 10th Annual Itau BBA LatAm CEO Conference

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DISCLAIMER

The statements contained in this presentation related to the business outlook, operating and financial projections, and growth

prospects of Klabin S.A. are merely projections, and as such are based exclusively on the expectations of the Company’s

management concerning the future of the business.

These forward-looking statements depend substantially on the market conditions, the performance of the Brazilian economy,

the industry and international markets, and therefore are subject to change without prior notice.

This presentation on Klabin’s performance includes non-accounting and accounting data, such as operating and financial

information, as well as projections based on Management’s expectations. Note that the non-accounting data has not been

reviewed by the Company’s independent auditors.

The Company’s management believes EBITDA may provide useful information on the Company’s operating performance and

allow for comparisons with other companies in the same industry. Note however that EBITDA is not a measure established in

accordance with generally accepted accounting principles of the International Financial Reporting Standards – IFRS, and may be

defined and calculated differently by other companies.

!


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CONSISTENTPERFORMANCE


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INTEGRATED BUSINESSESCOMPETITIVENESS TROUGH ALL THE CHAIN

750thousand tonnes

220thousandtonnes

1,050thousand tonnes

COATEDBOARDS

INDUSTRIAL BAGSand SACK KRAFT

CORRUGATED BOXESand KRAFTLINER

EUCALYPTUS AND

PINE FORESTS

243thousand ha

1.7million tonnes

OLD CORRUGATED

CONTAINERS

330thousand

tonnes

HIGH YIELDFOREST

FOREST PULP PAPER and CONVERSION

#

INDUSTRIALEFFICIENCY

HIGH QUALITYand FLEXIBILITY


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DIVERSIFIED PRODUCT LINEMARKET POSITIONLOW COST

QUALITY

INDUSTRIALBAGS

CORRUGATEDBOXES

50%market share market share

16%

source: ABPO, IBÁ$

sole suppliero f l i q u i dp a c k a g i n gboard in LatinAmerica

40%installedcapacity

COATEDBOARDS

50%market share

KRAFTLINER

68%

food

13%otherconsumergoods

12%

others

7%building

SALES VOLUME DESTINATIONPAPER AND PACKAGING

STRONGLY LINKED TORESILIENT MARKETS

LEADER IN BRAZILIN ALL MARKETS


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2016

PUMAPULP MILL

3,5 MILLION TONNES

%

2011- 2013

PERFORMANCEIMPROVEMENT

1,7 MILLION TONNES

2014 - 2015

PAPEREXPANSIONS -COMPLETED

2,0 MILLION TONNES

BUSINESS EVOLUTION

TIMELINE

"#$%&'(&) %&(*+,( '#)

(&, ,-& .',- /0% /*,*%& 1%02,-

NEW GROWTHOPPORTUNITIES

2016 on


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&'() * '+,- -./01/ 234-5,

% CHANGE VS PREVIOUS YEAR

EBITDA GROWTHCONSISTENT RESULTS DESPITE CHALLENGING SCENARIOS


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6

PERFORMANCE IMPROVEMENT STABLE MARGINS +EXPANSION OF CAPACITY

a d j u s t e d E B I T D A

L T M -

R $ m i l l i o n

2014 - 2015 2011 - 2013

EBITDA GROWTH

SUSTAINABLE PERFORMANCE


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PUMAPROJECT


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78


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PRODUCTION OF

270 MWhof ENERGY

SELF SUFFICIENT

120 MWhFOR PUMAUSE

150 MWhFOR SALE INTHE MARKET

ANNUAL PRODUCTIONCAPACITY

1.5 MILLIONTONNES OF PULP

LOW OPERATIONCOST

1.1 MILLIONTONNES OF

SHORT FIBER 400 THOUSANDTONNES OFLONG FIBERPART CONVERTED TO FLUFF

77


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CURRENT STATUS

areas delivered toEPC´s

100% of earthmoving

concluded

Assembly started

EPC´s with Klabincoordination

dedicated team: strongfeedback and control

95% ofequipment

supplies,materials and

servicesconcluded

lower dependencyon importedequipments

EUR 365 million(55% already paid)

COMPLETION COST

OF THE PROJECT COMPLETED58%0% 100%

OF THE CAPEX DISBURSED41%0% 100%

7!


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INDUSTRIAL CAPEX46%

national equipments andmaterials

14%

importedequipments

14%

engineeringand other

services

27%

civil constructionand assembly

TOTAL CAPEX

R$ 7.2 BI

INDUSTRIAL CAPEXR$ 5.8 BINET OF

RECOVERABLETAXES

PROJECT

FULLY FUNDED79


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LOGISTICSMULTIMODAL

72 Kmforestry average

distance

PULP MILLFORESTS

441 Kmrailway to the port

PARANAGUÁPORT

INBOUND OUTBOUND

7#


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Investor Relationswww.klabin.com.br/[email protected]: +55 (11) 3046-8401


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APPENDIXEARNINGS1Q15

PUMA MARKETCOMMERCIAL CONTRACT


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EARNINGS1Q15


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HIGHLIGHTSSALES VOLUME

excluding wood– tsd tonnes

65%

35%443

1Q14

67%

33%437

1Q15

NET REVENUE R$ million

74%

26%1,203

1Q14

72%

28%1,308

1Q15

exports domesticmarket

- 1%

ADJUSTED EBITDA R$ million

424

1Q14

461

1Q15

76


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KRAFTLINER (3)

RECYCLED (2)

KRAFTLINER ANDCOATED BOARDS (1)

KRAFTLINER

31%

69%

34%

66%

1Q14

105thousand

tonnes

1Q15

96 thousand

tonnes

171R$

million

182R$million

1Q14 1Q15

PAPER

BUSINESS UNITCOATEDBOARDS

55%

45%

55%

45%

1Q14

161thousand

tonnes

1Q15

163thousand

tonnes

1%

415R$million

474R$

million

1Q14 1Q15

exports domesticmarket

7:


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CORRUGATED BOXES (7)

INDUSTRIAL BAGS (3)

CORRUGATED BOXES ANDINDUSTRIAL BAGS (1)

1Q14

173thousand

tonnes

1Q15

169thousand

tonnes

525R$million

536R$

million

1Q14 1Q15

CONVERSION

MARKET POSITION

+ !8


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CASH COST

1,782R$/tonne

1Q14

1,900R$/tonne

1Q15*

+7 %

*Excluding non-recurring effects of stoppages in Otacílio Costa mill (SC)

and in the Turbo Generator 8, in Monte Algre (PR) mill

!7

CASH COSTBREAKDOWN

UNITCASH COST


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NET DEBT

!!


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DEBT PROFILE

!9

MATURITY SCHEDULER$ million

Local currency : R$ 4.1 billion Average tenor: 45 months

Foreign currency: R$ 6.9 billion Average tenor : 57 months

5,600

CASHPOSITION


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maintenance

CAPEX

CAPEXR$ million 2011

3T14296

special projects and growth 159

vale do corisco 428

PUMA project -

total 883

2012

3T14390

264

-

-

654

2013

3T14369

431

-

99

899

2014

3T14384

319

-

2,242

2,945

2015E

3T14350

385

-

3,437

4,172

!#


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PUMAPULP MARKET


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PULP MARKET

33%

eucalyptus

45%

long fiber

22%othershort fibers

PULP MARKETDISTRIBUTION

2014

Source: Hawkins Wright; RISI

52.6milliontonnes

market pulp

112million tonnes

integrated pulp

164 mm t

VIRGINFIBERPULP

!%


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PUMA: 6th LARGEST PULP MILLLARGEST MARKET PULP MILLS OF THE WORLD

Fibria Aracruz 2,340

April Riau 2,200

April Rizhao 1,700

Eldorado 1,500

CMPC Guaíba 1,690Suzano Mucuri 1,565

Klabin 1,500

Suzano Maranhão 1,500

Source: Hawkins Wright (jul/14)

28.6short fiber 52.6 marketpulp

17.5

eucalyptus

WORLD DEMANDmillion tonnes per year in 2014

Montes del Plata 1,300

million tonnes per year in 2014

!;


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4th LARGEST IN FLUFF

Source: Hawkins Wright

WORLD CAPACITY OF FLUFFthousand tonnes per year in 2014

GP2,296

Weyco1,420

IP1,045

PumaKlabin

400

Domtar 334

Resolute290

Stora255

Arauco250

Rock Tenn170

Rayonier

110

UPM100

millsconverted influff mills

the only designed to producefluff from the start

fibra longa

6,4fluff and

SBSK

WORLD DEMANDmillion tonnes per year in 2014

23,7


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FOCUS ON CONSUMER MARKETS

Source: RISI, Euromonitor

96% USA

50% BRA

72% ARG

MARKET PENETRATION INDISPOSABLE DIAPERS2013

high potentialof growth

SOPHISTICATION AND INNOVATION INHIGHER VALUE ADDED PRODUCTS

!:


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BRAZIL IS THE 3RD LARGEST MARKETOF DISPOSABLE DIAPERS IN THE WORLD

3.3

2008

4.2

2009

4.9

2010

5.7

2011

6.0

2012

6.5

2013

SALES OF DIAPERSFOR INFANT

R$ billion

Source: Euromonitor

0.4

2008

0.5

2009

0.6

2010

0.8

2011

1.0

2012

1.2

2013

SALES OF DIAPERSFOR ADULTSR$ billion

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COMPOSITION OF DIAPERS

30% TO 50% OF THE AVERAGE WEIGHT OF A DIAPER IS COMPOSED OF FLUFF (20 TO 40G)

97


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5milliontonnes

ANNUAL

CAPACITY

CIF: COST, INSURANCE AND FREIGHT INCLUDED

GLOBAL CASH COST (SHORT FIBER)

PUMA

CIF EUROPEUS$/TONNE

400

500

600

10milliontonnes

15milliontonnes

20milliontonnes

25milliontonnes

Source: Hawkins Wright99


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KLABIN & FIBRIA

COMMERCIAL CONTRACTHARDWOOD PULP


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1.1 mt

of hardwood

400 ktof softwood,

part converted to fluff

Sale minimum

900 ktof hardwood / year

344 563F 5+EI.33I J K/+E

744 563F ,3L.33I J K/+E

MNOPQ(< MNRMO(


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hardwood 900 kt

F3E/,-EK

?A0?

?0+4-

Paranaguá Port(PR)

(;C? H:I


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VE32 ,-+E-XA?

I+-/ A4Y0 Z/[/2D/E

!87% !87; !876 !87: !8!8 !8!7 !8!!

7! 234-5, 7! 234-5, 7! 234-5, 7! 234-5, ;! 234-5,

+L/E ,-+E-XA?

M44 56 8N

O;:LP88L

!"# "%&% 8N 6O?

H?:I8L

QI9ICFC 8N M44 56 8N O;:LP88L

.O;J? 8F6 @ ;$\ 3F

-5/ I/0@1/E/I @4

!87:

.O;J? 8F6 3

$8\ 3F -5/ I/0@1/E/I

@4 !87:&9L 8N 6O?


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'T:??C?96 K?9?U6J

'3B@,Y[, +4I [322/E[@+0

,-EA[-AE/ ,K4/EB@/,_

M4,AE/ ,+0/, 130A2/,_

M4,AE/ ?A0? 2+E^/- +[[/,, .@-5

>0+D@4 DE+4I`

'3B@,Y[, +4I [322/E[@+0

3?Y2@a+Y34 +4I ,K4/EB@/,_


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T4431+Y1/ +BE//2/4- /e?03E@4B

[3E/ [32?/-/4[/,f V@DE@+b,

[322/E[@+0 /e?/EY,/ +4I -5/

E/[3B4@a/I >0+D@4b, @4IA,-E@+0 /g[@/4[K̀

@>0+D@4 @, B3@4B -3 ,/00 23,- 3F -5/OA2+ OE3h/[- 5+EI.33I ?A0? -3

V@DE@+̀

7

V

3>0+D@4 @, B3@4B -3 ,/00 -5/ E/2+@4@4B

5+EI.33I ?A0? @4


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INCOME STATEMENT

numbers in thousand R$ #8


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BALANCE SHEET

numbers in thousand R$ #7

presentation - 10th annual itau bba latam ceo conference

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