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April, 2015
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Disclaimer
1
2
3
4
Company Overview
Pulp and Paper Market
Financial and Operational Highlights
Final Remarks
Agenda
Company Overview
4
A Winning Player
Superior Asset Combination
Belmonte
Veracel
Caravelas
Portocel
Aracruz
Trs Lagoas
Pulp capacity
million tons
5,300
Net revenues
R$ billion
7.1
thousand hectares
968
Planted area(1)
thousand hectares
561
R$ billion
7.6
2.4
2.7
Net Debt
Jacare
Santos
Port Terminal
Pulp Unit
Source: Fibria
(1) Including 50% of Veracel, excluding forest partnership areas and forest bases linked to the sales of Losango and forest assets in Southern Bahia State.
(2) For covenants purposes, the Net Debt/EBITDA ratio is calculated in Dollars.
* Veracel is a joint venture between Fibria (50%) and Stora Enso (50%) and the total capacity is 1,120 thousand ton/year
Highlights
Region - 4Q14
N.
America
27%
Tissue
56%
Europe
40%
Asia
23%
Printing &
Writing
25%
Specialties
19%
Other
10%
14% 20%
37%
46% 41%
30%
46%
20%
8%
8%
9%
9% 10% 10%
20% 23% 25% 26% 21% 26% 26% 26% 27% 25% 23%
31% 28%
35% 44%
42%
Worldwide presence
Long-term relationships
39% 40%
46% 42%
4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
North America
Europe
Asia
Other
Votorantim
Industrial S.A.
(1)
29.42%
BNDES
Participaes (1)
30.38%
Free
Float (2)
General
Meeting
40.20%
Fiscal
Council
20% independent
members
Role of CEO and
chairman is split
Board of
Directors
Finance
Committee
Statutory
Audit
Committee
Personnel and
Remuneration
Committee
Sustainability
Committee
Innovation
Committee
30%
independent
members
100%
independent
members
50% independent
members
45% independent
members
Corporate Governance
Anti-Corruption
Information Disclosure
Securities Trading
Antitrust
Genetically Modified Eucalyptus
1,275
Suzano Maranho
320
1,270
100
DELAYED
Montes del Plata
Sappi Cloquet
Jari
555
-155
Sappi Cloquet
-410
Jari
Net
BEKP demand growth*
1,585
1,080
-155
-410
Cellulose du Maroc
-140
Sodra Tofte
-60
Net
BEKP demand growth*
Unexpected
Closures
605
1,310
10
814
810
800
790
795
788
791
784
780
772
770
767
765
770
772
760
750
740
1Q13
2Q13
3Q13
4Q13
Annual 2013
Consultants: Hawkins Wright, RISI and Brian McClay (published in the end 2012 for 2013 prices)
11
230
Eldorado
1,275
Suzano Maranho
Montes del Plata
Suzano Maranho
830
1,100
560
Oji Nantong*
230
Eldorado
550
Oji Nantong*
235
UPM
100
Sappi Cloquet
-115
Sappi Cloquet
-70
Sodra Tofte
-120
Sodra Tofte
-120
APRIL Rizhao
2,660
Net
BEKP demand growth**
1,380
-65
Old Town
-85
Ence Huelva
-105
More unexpected
mill closures
Net
1,770
1,734
12
782
780
768
752
760
740
737
746
729
734
733
720
718
700
696
680
660
640
1Q14
2Q14
3Q14
4Q14
Annual 2014
Consultants: Hawkins Wright, RISI and Brian McClay (published in the end 2013 for 2014 prices)
13
400
750
Oji Nantong
750
CMPC Guaiba II
200
Eldorado
Portucel Cacia
30
85
Sappi Cloquet
April Rizhao
Ence Huelva
Possible closures*
Net
115
-65
-315
-400 to -800
1,415 to 1,815
1005
14
11%
16%
1,734 kt
20%
6%
5%
717 kt
386kt
378kt
13%
44%
537 kt
29%
58kt
92 kt
Total
(1)
North
America
Western
Europe
China
Others
Total
(2)
North
America
13%
214kt
2%
83kt
21kt
Western
Europe
China
Others
2014
2015
Total
FORECAST
REALIZED
PREVIOUS
FORECAST
LATEST
FORECAST
PREVIOUS
FORECAST
LATEST
FORECAST
PREVIOUS
LATEST
Woodfree
-25
199
256
550
760
525
1,215
Tissue
1,184
833
1,518
1,390
903
727
3,605
2,950
Cartonboard
2,428
2,128
1,300
2,100
300
380
4,028
4,608
Total
3,587
3,160
2,818
3,746
1,753
1,867
8,158
8,773
15
35.000
30.000
25.000
20.000
15.000
10.000
5.000
Hardwood
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
Softwood
Source: PPPC
1998
15.0
2008
24.5
2018
32.8
Growth
19982008
Growth
20082018
63%
34%
6.0
14.2
23.4
137%
63%
1000
150
900
800
100
Eucalyptus
1100
Spread Fev./15:
US$160
200
700
Average spread:
US$ 111
50
600
500
Softwood
17.6
21.6
24.8
Market Pulp
32.6
46.1
57.1
23%
15%
400
Spread
Source: PPPC. Excludes Sulphite and UKP market pulp.
(1)
Average spread
BHKP
NBSK
16
3.000
Weighted average
technical age 12.3 years
STRONG
2.500
STRONG
2.500
Aracruz
2.000
1.500
2.000
Weighted average
capacity 1,277,000 t/a
Trs Lagoas
1.500
Jacare
1.000
Veracel
1.000
Weighted average
capacity 527,000 t/a
Ence
Huelva
500
500
Old
Town
0
30
WEAK
20
10
0
30
WEAK
25
Closures
20
15
10
Technical Age, years
Grade Switch
On & Off
More than 7.7 million tons of capacity above 25 years and with annual capacity below 500,000 t/y.
17
-105
-540
-500
-830
-910
-1,085
-1,180
-1,260
2006
2007
2008
2009
2010
2011
2012
2013
2014-2016 E
as of Dec.14
18
1,775
705
580
570
1,660
1,055
2,315
335
545
3,790
330
1,015
3,950
7,480
Interest
71
46
69
41
86
121
34
38
41
48
55
38
67
111
498
= 31,405
5,300
508
456
468
420
404
424
424
W/K
Interest
119
Capex
Income Tax
51
SG&A
61
406
342
315
311
297
235
18
39
186
Delivery (US$/t)
Source: Hawkins Wright (Outlook for Market Pulp, December 2014) | Fibrias 4Q14 considering a FX of R$/US$2.54. | Brazil ex-Fibria 3Q14 considering FX of R$/US$2.27.
Gray bar includes cash expenses as Interest, CAPEX, SG&A and Taxes (Source: RISI and Fibria).
19
1.000
900
1,8
1,6
Rizhao
Maranho
Trs
Lagoas
700
APP
Hainan
600
500
400
Eldorado
Fray
Bentos
Mucuri
Veracel Nueva Aldea
Santa F
Valdivia
1,4
Montes
del Plata Guaba II
1,2
Klabin
1,0
Chenming
Zhanjiang
Kerinci
PL3
800
2,0
0,8
APP Guangxi
Oji
Nantong
300
0,6
200
0,4
100
0,2
0,0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
(1) Source: Hawkins Wright , Poyry and Fibria Analysis. Pulp price estimates according to Hawkins Wright (Dec/14), Brian McClay (Jan/14) and RISI (Dec/14)
(2) Partially integrated production
20
30%
26%
23%
23%
21%
15%
6%
Sugar
WTI Crude
Oil
Soy
Iron Ore
Cattle
FOEX PIX
BHKP
Iron Ore
Crude Oil
Soy
LME
Metals
Ibovespa
Cattle
Pulp BHKP
-20%
-47%
-51%
-26%
5%
-2%
-24%
-45%
-50%
-26%
-11%
8%
5%
47% | 19%
FIBR3|FBR
(1) Since 2009 | (2) Except Iron Ore (Average of: Vale, Rio Tinto and BHP) and LME Metals | (3) As of Feb., 27 th
21
466
26
4Q13
472
Wood
FX
( 22 )
(7)
Utilities
Energy
Consumption
Others
4Q14
+ 1.3%
23
Cash Production Cost saw a annual increase of 3.7% over the past
6 years
Fibria Cash Production Cost (1) (R$/ton)
CAGR: + 3.7%
505
432
2009 (2)
448
2010 (2)
471
473
2011
2012
2013
519
Consistently
controlling the
production
cash cost at a
level below
the inflation
pace.
2014
24
Hedge
FX Debt
3,530
(112)
2,791
(696)
851
(504)
(1,874)
(380)
141
Adjusted
EBITDA
Befiex
EBITDA
debt
Deprec.,
amortiz.and
depletion
Taxes
(54)
Others (1)
163
Net Income
Non-recurring
effects
(1)
2,791
636
(1,591)
(411)
Adjusted
EBITDA
2014
Capex
Interest
(paid/received)
(136)
(29)
12
Working
Capital
Taxes
Others
(1)
353
989
4Q14 receivables
Modernization (trucks);
R&D;
FX effect.
(Pro-forma)
Capex includes investment in modernization and higher % of third-party wood, decreasing as from 2016;
2015
(1) Does not include: asset sales, expenses on bonds repurchase and tax credits from the BEFIEX program.
26
2.00
1.76
1.67
670
639
912
660
1,067
676
627
29%
34%
2,526
EBITDA (R$ million)
2.29
610
572
564
1,709
40%
EBITDA Margin
581
2.10
456
1,179
1.95
1,133
657
36%
1,964
2,253
2011
2012
1,281
680
40%
Market
Consensus
1,310
676
39%
2,796
2,791
2013
2014
1,522
2009 (1)
2010 (1)
2015
(1) Excludes Conpacel | (2) 2014 year end market consensus | (3) According to Focus Report (Brazilian Central Bank Mar. 2nd, 2015) | (4) According to Poyry full cost estimate - includes Manufacturing
+ Delivered costs to Rotterdam + Depreciation + ROCE of 9%
27
Capital Structure: Fibria has achieved the lowest leverage ratio among
its Latin American peers
Net Debt/EBITDA (x)(1)
14.8
13.2
11.7
11.1
8.9
4.8
4.5
4.5
3.7
3.6
3.1
3.6
2.9
3.1
2.4
1Q12
2Q12
3Q12
Fibria
4Q12
Suzano
1Q13
Klabin
2Q13
3Q13
4Q13
CMPC
1Q14
2.7
2.4
2.3
3.23.4
3.0
2.7
1.7
1.7
4Q11
4.1
2Q14
Arauco
3Q14
4Q14
Eldorado
Fibria
Arauco
CMPC
Klabin
Suzano
S&P
BB+/Positive
BBB-/Stable
BBB+/Negative
BBB-/Negative
BB/Stable
Moodys
Ba1/Positive
Baa3/Stable
Baa3/Negative
Ba2/Stable
Fitch
BBB-/Stable
BBB/Stable
BBB+/Stable
BBB-/Negative
BB/Stable
(1)
28
Indebtdeness
Net Debt (Million)
2.8
2.7
2.7
Interest (US$)
61
50
44
2.6
2.5
7,849
2.4
3,351
R$
Dec/13
Dec/14
8,327
3,498
2,842
Sep/14
- 25%
8,574
4,172
2,984
Dec/13
9,773
7,549
7,313
Sep/14
R$
US$
3,135
Dec/14
US$
4.3
893
600
3.7
632
459
52
375
364
363
3.4
600
(revolver)
55
55
Sep/14
Dec/14
223
293
93
(cash)
Liquidity 2015
2016
2017
Pre-payment
2018
BNDES
2019
ECN
2020
ACC/ACE
2021
22
2022
2023
Voto IV
Bonds
2024
Dec/13
(*) Considering the portion of debt in reais fully adjusted by the market swap curves at the end of
each period..
29
7.5
6.3
4.1
8.6
4.2
3.3
2.6
6.3
2.4
473
5.9
414
5.5
408
5.2
2010
2011
2012
Gross Debt
2013
2014
3.4 *
350
268
3.1 2.8
2009
4.6
200
2009
2010
2011
2012
2013
2014
Net Debt
Interest
Reduction
Cost of Debt
Reduction
This dynamics
creates a virtuous
cycle
(*) Considering the portion of debt in reais fully adjusted by the market swap curves of Dec. 31, 2014.
30
Highlights
US$ 600 million
Issuance Date:
May/2014
Coupon:
5.25% a.a.
Bookbuilding:
- SEC registered;
- IG Documentation;
- Stretch Debt maturities;
11.5x
275.0 bps
Rating
Maturity
Volume
T-Spread
Coupon
Fibria
2024
US$ 600 MM
275 bps
5.25%
Braskem
Baa3/BBB-/BBB-
2024
US$ 500 MM
340 bps
6.45%
Petrobras
Baa1/BBB/BBB
2024
US$ 2,5 bi
350 bps
6.28%
BNDES
Baa2/BBB-/
2024
US$ 500 MM
362 bps
6.32%
Klabin
BBB-/BBB-
2024
US$ 500 MM
269 bps
5.25%
Baa3/BBB/BBB
2029
US$ 500 MM
263 bps
5.25%
Odebrecht
Data as of Aug 07, 2014:
31
266
232
311
288
287
328
344
363
522
563
404
370
140
140
143
150
COPEC
Ecopetrol
Raizen
Fibria
Colbun
Braskem
4 years
5 years
4 years
5 years
6 years
5 years
175
113
Avg. Term
(1)
As of March 2015
Molymet
TGI (O&G)
5 years
5 years
32
800
0,9
0,8
700
0,8
600
0,3
500
400
300
-0,2
200
-0,6
100
Fibria 24 vs.
Petrobras 24
Fibria 2024
Petrobras 2024
(1)
Braskem 2024
Gerdau 2024
Klabin 2024
Samarco 2024
Odebrecht 2023
Brazil 2025
Fibria 24 vs.
Brazil 25
33
Fibria has the simplest and most transparent call in the industry
Negative
Pulp supply
Neutral
Positive
Tissue
China
Closures/conversions
Inefficient capacities in China
Demand
Fiber and grade substitution
Pulp price
Brazil GDP
Energy crisis
FX
Capex inflation
Tax
Corporate Governance
Cost inflation
Rating
34
Final Remarks
35
100%
75%
65%
70%
43%
60%
50%
50%
40%
30%
30%
33%
20%
15%
10%
0%
Forestry
Industrial
Logistics/Other
Total
2015
2016
2017
2018
2019
37
Fibrias
Owned Land
Total
Ha
Book Value
Market Value
(000)
R$/ha
R$/ha
491
2,535
7,964
38
Max Value Project Turning areas per hectare into square meter
The targeted area represents only 0.6% of the land owned by Fibria;
Fibria is seeking value creation for its shareholders with capital discipline
PULP
INDUSTRY
CONSOLIDATION ?
Potential
Growth
Prospects
BIO-ENERGY
OTHER OPPORTUNITIES
- Complementary to pulp
Portocel
- Ensyn
40
-21%
656
5,054
5,299
5,184
5,271
624
596
432
448
2009*
2010*
5,274
549
545
471
473
505
519
2011
2012
2013
2014
4,600
2009*
2010*
2011
2012
2013
2014
Historical Value
593
-21%
826
593
766
605
40%
678
584
29%
699
648
Inflation Effect**
34%
2,526
651
1,964
36%
40%
39%
2,796
2,791
2013
2014
2,253
1,522
2009*
2010*
2011
Historical Value
2012
2013
2014
2009*
2010*
2011
2012
Inflation Effect**
41
Back up
42
Amount
Annual tax deduction:
R$89 million (tax)
Goodwill
(Aracruz
acquisition)
Forestry Capex in
Mato Grosso do
Sul state
Benefit
Amount
Tax loss
carryforward
2018
Accumulated tax
credits
Undefined
2010
2011
2012
2013
2014
R$ 7 million
R$ 16 million
R$ 4 million
R$ 15 million
R$ 31 million
R$ 29 million
43
MAI* Pulp:
(adt/ha/year)
15.0
12.1
10.6
15.0
15.0
15.0
15.0
Conservative assumption
10.9
2010
2015
2020
2025
2030
2035
2040
2045
Actions:
Genetic improvement
Excellence in forestry management
Superior industrial efficiency
44
Leadership position
Industry Outlook(1)
Fiber Consumption
406 million t
59%
41%
Recycled Fiber
238 million t
Pulp
168 million t
18%
82%
Mechanical
30 million t
Chemical
138 million t
59%
41%
Integrated Mills
82 million t
Market Pulp
56 million t
54%
46%
Softwood/Other
26 million t
Hardwood
30 million t
33%
67%
Acacia/Other
10 million t
Eucalyptus
20 million t
74%
Other Eucalyptus
Pulp producers:
15 million t
(1)
26%
Fiber Consumption, Recycled Fiber and Pulp: RISI | Market Pulp, Hardwood and Eucalyptus: PPPC Global 100 Report December 2014
45
MAIN PROJECTS
Project
Fibria
APRIL
Arauco
Suzano
CMPC
UPM-Kymmene
Georgia Pacific
Paper Excellence
Metsa Group
Stora Enso
Weyerhaeuser
Ilim
Eldorado
Mercer
Domtar
IP
Sodra
Resolute Forest
Canfor
ENCE
Country
Capacity
Timing
Fiber
Status
CMPC Guaba II
Brazil
1.3 Mt
2Q2015
BEKP
Confirmed
Klabin Paran
Brazil
1.5 Mt
2Q2016
BEKP/
BSKP/Fluff
Confirmed
Indonesia
2.0 Mt
1Q2017
BHKP
Confirmed
Brazil
1.75 Mt
BEKP
Unconfirmed
2000
4000
6000
Cost position
of marginal
producer
46
Jan/2014
686
Jan/2015
600
205
186
160
Latin
America
25
20
10
186
16 18
BHKP Total
LTM Growth
Rate +4.2%
30
15
285
214
(kg/person/year)
35
Indonesia
Others*
USA
11
Canada
Western
Europe
20%
22%
21%
23%
23%
W.Europe
Japan
Africa
E.Europe
China
L.America
Asia FE
(million t)
12
10
17%
(Kg/capita/year)
24
8
15%
12%
10%
14%
15
6
10%
10%
4
5%
15
12
7
0%
5
1
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Eucalyptus
Hardwood
Total
N.
West Japan Oceania East LatAm
America Europe
Europe
China
Africa
47
117,611
114,507
85,291
P&W
Consumption
(000 tons)(1)
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Developed Markets
Emerging Markets
37,474
26,877
15,548
Tissue
Consumption
(000 tons)(1)
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Developed Markets
Emerging Markets
Source: RISI
48