INSTITUTIONAL PRESENTATION

ITAU CONFERENCE NEW YORK - MAY, 2015

KLBN11

KLBN11 / KLBAY

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 Companys
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 Klabins performance includes non-accounting and accounting data, such as operating and financial
information, as well as projections based on Managements expectations. Note that the non-accounting data has not been
reviewed by the Companys independent auditors.
The Companys management believes EBITDA may provide useful information on the Companys 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.

CONSISTENT
PERFORMANCE

INTEGRATED BUSINESSES

COMPETITIVENESS TROUGH ALL THE CHAIN

FOREST

243

thousand ha

PULP

1.7

PAPER and CONVERSION

COATED
BOARDS

million tonnes

750

thousand tonnes

220

INDUSTRIAL BAGS
and SACK KRAFT

thousand
tonnes

330

thousand
tonnes
EUCALYPTUS AND
PINE FORESTS

HIGH YIELD
FOREST

CORRUGATED BOXES
and KRAFTLINER

1,050

thousand tonnes

OLD CORRUGATED
CONTAINERS

INDUSTRIAL
EFFICIENCY

HIGH QUALITY
and FLEXIBILITY

DIVERSIFIED PRODUCT LINE

LOW COST
QUALITY
COATED
BOARDS

sole supplier
of
liquid
packaging
board in Latin
America

50%

market share

INDUSTRIAL
BAGS

LEADER IN BRAZIL
IN ALL MARKETS
KRAFTLINER

MARKET POSITION

STRONGLY LINKED TO
RESILIENT MARKETS

68%
installed
capacity

40%

CORRUGATED
BOXES

7%
building

12%
others

50%

16%
market share

source: ABPO, IB

market share

food
13%

other
consumer
goods

SALES VOLUME DESTINATION

PAPER AND PACKAGING

5

BUSINESS EVOLUTION

TIMELINE

2011- 2013

2014 - 2015

2016

2016 on

PERFORMANCE
IMPROVEMENT

PAPER
EXPANSIONS COMPLETED

PUMA
PULP MILL

NEW GROWTH
OPPORTUNITIES

1,7 MILLION TONNES

2,0 MILLION TONNES

3,5 MILLION TONNES

INCREASED RESULTS AND

SET THE PATH FOR FUTURE GROWTH
6

EBITDA GROWTH

CONSISTENT RESULTS DESPITE CHALLENGING SCENARIOS

% CHANGE VS PREVIOUS YEAR

*LTM = Last twelve months

EBITDA GROWTH

LTM - R$ million

adjusted EBITDA

SUSTAINABLE PERFORMANCE

2011 - 2013
PERFORMANCE IMPROVEMENT

2014 - 2015
STABLE MARGINS +
EXPANSION OF CAPACITY
8

PUMA
PROJECT

10

LOW OPERATION
COST

PRODUCTION OF

ANNUAL PRODUCTION
CAPACITY

of ENERGY
SELF SUFFICIENT

1.5 MILLION
TONNES OF PULP

1.1 MILLION
TONNES OF

SHORT FIBER

400 THOUSAND

270 MWh

120 MWh
FOR PUMA
USE

150 MWh
FOR SALE IN
THE MARKET

TONNES OF

LONG FIBER
PART CONVERTED TO FLUFF

11

CURRENT STATUS
COMPLETION
areas delivered to
EPCs
100% of earthmoving
concluded

COST

EPCs with Klabin

coordination
dedicated team: strong
feedback and control

Assembly started
0%

0%

41%

95% of
equipment
supplies,
materials and
services
concluded

lower dependency
on imported
equipments
EUR 365 million
(55% already paid)

58%OF THE PROJECT COMPLETED

100%

OF THE CAPEX DISBURSED

100%
12

46%

INDUSTRIAL CAPEX
TOTAL CAPEX

14%

INDUSTRIAL CAPEX

national equipments and imported

materials equipments

14%

R$ 7.2 BI

27%

engineering
and other
services

R$ 5.8 BI

NET OF
RECOVERABLE
TAXES

PROJECT

FULLY FUNDED
civil construction
and assembly

13

LOGISTICS

MULTIMODAL

72 Km

441 Km

forestry average
distance

FORESTS

railway to the port

PARANAGU
PORT

PULP MILL

INBOUND

OUTBOUND
14

Investor Relations
www.klabin.com.br/ir
invest@klabin.com.br
Phone: +55 (11) 3046-8401

APPENDIX
EARNINGS1Q15
PUMA MARKET
COMMERCIAL CONTRACT

EARNINGS
1Q15

HIGHLIGHTS
SALES VOLUME

excluding wood tsd tonnes

NET REVENUE

- 1%

443

437

1,203

35%

33%

26%

65%

67%

74%

1Q14

1Q15
exports

ADJUSTED EBITDA

R$ million

1Q14

R$ million

1,308

28%

461

424

72%

1Q15

1Q14

1Q15

domestic
market
18

PAPER

BUSINESS UNIT

COATED
BOARDS
1%

161

thousand
tonnes

45%

163

thousand
tonnes

45%

KRAFTLINER

KRAFTLINER (3)
KRAFTLINER AND
COATED BOARDS (1)
RECYCLED (2)

415

R$
million

474

R$
million

105

thousand
tonnes

69%
55%

thousand
tonnes

171

R$
million

R$
million

66%

55%

31%

1Q14

96

182

1Q15

1Q14

1Q15

1Q14

exports

domestic
market

34%

1Q15

1Q14

1Q15
19

CONVERSION
MARKET POSITION
CORRUGATED BOXES (7)
CORRUGATED BOXES AND
INDUSTRIAL BAGS (1)
INDUSTRIAL BAGS (3)

525

R$
million

1Q14

173

536

thousand
tonnes

R$
million

1Q15

1Q14

169

thousand
tonnes

1Q15
20

CASH COST
UNIT
CASH COST

CASH COST
BREAKDOWN

+7%

1,782

1,900

R$/tonne

R$/tonne

1Q14

1Q15*

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

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

21

NET DEBT

22

5,60
0

DEBT PROFILE
MATURITY SCHEDULE
R$ million

CASH
POSITION

Local currency : R$ 4.1 billion

Average tenor: 45 months

Foreign currency: R$ 6.9 billion

Average tenor : 57 months
23

CAPEX
CAPEX
R$ million

2011

2012

2013

2014

2015E

maintenance

3T14
296

3T14
390

3T14
369

3T14
384

3T14
350

special projects and growth

159

264

431

319

385

vale do corisco

428

99

2,242

3,437

883

654

899

2,945

4,172

PUMA project
total

24

PUMA

PULP MARKET

PULP MARKET
2014

VIRGIN
FIBER
mm t PULP

164
112

million tonnes

52.6

million
tonnes

integrated pulp

Source: Hawkins Wright; RISI

market pulp

PULP MARKET
DISTRIBUTION

45%

33%
eucalyptus

long fiber

22%
other
short fibers

26

PUMA: 6th LARGEST PULP MILL

LARGEST MARKET PULP MILLS OF THE WORLD

million tonnes per year in 2014

Fibria Aracruz

2,340

April Riau

2,200

April Rizhao

1,700

CMPC Guaba

1,690

Suzano Mucuri

1,565

Klabin

1,500

Suzano Maranho

1,500

Eldorado

1,500

Montes del Plata

1,300

Source: Hawkins Wright (jul/14)

WORLD DEMAND

million tonnes per year in 2014

short fiber

28.6

52.6 market
pulp

17.5

eucalyptus
27

4th LARGEST IN FLUFF

WORLD CAPACITY OF FLUFF
thousand tonnes per year in 2014

2,296

GP
1,420

Weyco
1,045

IP
400

Puma
Klabin

334

Domtar

290

Resolute
Stora
Arauco
Rock Tenn
Rayonier
UPM

255
250

mills
converted in
fluff mills

the only designed to produce

fluff from the start
WORLD DEMAND

million tonnes per year in 2014

23,7

170
110

6,4

fibra longa

fluff and
SBSK

100

Source: Hawkins Wright

SBSK = pinus long ber from USA

28

FOCUS ON CONSUMER MARKETS

MARKET PENETRATION IN
DISPOSABLE DIAPERS

SOPHISTICATION AND INNOVATION IN

HIGHER VALUE ADDED PRODUCTS

2013

USA

96%
high potential
of growth
BRA

50%

ARG

72%

Source: RISI, Euromonitor

29

BRAZIL IS THE 3RD LARGEST MARKET

OF DISPOSABLE DIAPERS IN THE WORLD

SALES OF DIAPERS
FOR ADULTS
R$ billion

1.0

SALES OF DIAPERS
FOR INFANT

1.2

R$ billion

0.8
0.6
0.4
2008

0.5

2009

2010

2011

2012

2013

3.3

2008
Source: Euromonitor

4.2

2009

4.9

2010

5.7

2011

6.5

6.0

2012

2013
30

COMPOSITION OF DIAPERS
30% TO 50% OF THE AVERAGE WEIGHT
OF A DIAPER IS COMPOSED OF

FLUFF

(20 TO 40G)

31

SPREADS AMONG DIFFERENT FIBERS

275

CIF EUROPE
US$/TONNE

60

fluff x short fiber

long fiber x short fiber

may jun
13 13

jul
13

aug sep
13 13

Source: RISI, FOEX

oct nov dec

13 13 13

jan
14

feb mar apr may jun

14 14 14 14 14

jul
14

aug sep oct nov dez jan feb mar

14 14 14 14 14 15 15 15
32

GLOBAL CASH COST (SHORT FIBER)

600

500

400

CIF EUROPE
US$/TONNE

PUMA

million
tonnes

Source: Hawkins Wright

10

million
tonnes

15

million
tonnes

20

million
tonnes

25

million
tonnes

CIF: COST, INSURANCE AND FREIGHT INCLUDED

ANNUAL

CAPACITY
33

KLABIN & FIBRIA

COMMERCIAL CONTRACT
HARDWOOD PULP

Contract Ra=onale
Puma Project

1 . 5 mt/year
1.1 mt

of hardwood

Sale minimum
900 kt

of hardwood / year

EXPORTS EXCEPT SOUTH

AMERICA

200 kt

of hardwood / year

400 kt

of softwood,
part converted to fluff

SOUTH AMERICA

+
400 kt

of soLwood / year

ALL MARKETS

Sales dynamics

900 kt

hardwood

final
customer

pulp
plant
Paranagu Port
(PR)

forestry

Same price as Fibria

FOB Paranagu

KLABIN
industrial efficiency

FIBRIA
commercial expertise

Timeline

900 kt of
hardwood
pro rata of the
period

2016

Minimum of 900 kt of hardwood

Phase out 2
50% of the delivered
in 2019

End of the contract

2017
From start-up
date unYl December

Phase out 1 75% of

the delivered in
2019

Pro rata 50% of

the delivered
in 2019

2018
12 months

2019
12 months

The contract may be renewed

by agreement between the parYes

2021

2020
12 months

12 months

2022
12 months

72 months
aLer start-up

Volumes may be reduced if Klabin decides to

integrate into paper for packaging

Agreement benets

LogisYcs and commercial

structure synergies;

LogisYcs and commercial

opYmizaYon and synergies;

Ensure sales volumes;

Support customers growth and

enhance customers needs;

Ensure pulp market access with

Klabin brand.

PotenYal development of new

customers.

Mutual value creaYon, with beder servicing for both Companies customers base.

Highlights

Klabin is going to sell most of the

Puma Project hardwood pulp to
Fibria.

Klabin is going to sell the remaining

hardwood pulp in South America,
and soLwood and u pulp globally.

Fibria will conYnue to place its

hardwood pulp in all regions,
including South America, on a
compeYYve basis.

InnovaYve agreement exploring

core competences: Fibrias
commercial experYse and the
recognized Klabins industrial eciency.

INCOME STATEMENT

numbers in thousand R$

40

BALANCE SHEET

numbers in thousand R$

41