INSTITUTIONAL PRESENTATION

3Q16

KLBN11

DEZEMBRO DE 2015
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.

INTEGRATED BUSINESS MODEL

DIVERSIFIED AND FLEXIBLE
TOTAL LAND

FIBERS

489k hectares

3.5 million tpy

PUMA PULP

1.1mi tpy
short fiber

0.4mi tpy
long fiber &
fluff pulp

PAPER
2.0 million tpy

PLANTED FORESTS
230k hectares
PINE

140k

hectares

EUCALYPTUS

90k

hectares

INTEGRATED
PULP
1.8mi tpy

RECYCLED FIBERS

265 THOUSAND TPY

* Installed capacity

COATED
BOARDS
750k
tpy

CONTAINERBOARDS
1.25mi tpy

CONVERSION
920 thousand tpy
CORRUGATED
BOXES
750k tpy

INDUSTRIAL
BAGS
170k tpy

STRUCTURAL COMPETIVENESS
HIGH PRODUCTIVITY ON FIBERS

Forestry
Pine
46

Eucalyptus

OF HIGH YIELD FOREST

58

38

44
22

PLANTED AREA
230 TSD HECTARES

m/ha/year

22

LOW AVERAGE
HAULING DISTANCE
PR with PUMA 66 Km
SC 74 Km

25

10

20

12

10

Mean Annual Increment (MAI) - KLABIN

Pine
50
39
40

42

42

44

46

47

35

30

60

30

50

52

95-05

05-11

58

61

12-15

16-20

65

41
35

40

24

20

26

20

<69

* Source: Ib and Klabin

70

50

31

m3/ha/year

Eucalyptus

70-89 90-04

05

06-09 10-11 12-15 16-20 21-25E

<73

74-85

85-95

21-25E

STRUCTURAL COMPETITIVENESS
GLOBAL SOFTWOOD AND HARDWOOD CASH COST

462

Softwood

447

409

Hardwood

335
288

272
174

FOB

US$/TONNES

million
tonnes

Source: Hawkins Wright april 2016

10

million
tonnes

15

million
tonnes

20

million
tonnes

25

million
tonnes

30

million
tonnes

ANNUAL

CAPACITY

STRUCTURAL COMPETITIVENESS

PUMA MILL EVOLUTION

PULP CASH COST

USD per tonne

RAMP UP

256

85% OF THE MILL CAPACITY

240
TOTAL PRODUCTION IN THE 3Q16

294 THOUSAND TONNES

CASH COST REDUCTION

COST DILUTION ON TRACK

2Q16

3Q16

STRUCTURAL COMPETIVENESS
LOW CASH COST POSITION

BEST CASH COST ON LPB PRODUCTION

35% LOWER THAN OTHER PLAYERS

PM9
production
cash cost
US$/tonnes

production
capacity
Source: Poyry 4Q15, 1US$ = R$ 3,50
Paper Machine (PM)

PM7

LPB PRODUCTION SITES

PAPER AND PACKAGING

LEADERSHIP IN RESILIENT MARKETS

KRAFTLINER

COATED
BOARDS

Market Share*

Market Share

40%

50%

INDUSTRIAL
BAGS

CORRUGATED

Market Share

Market Share

50%

18%

* Of Brazilian installed capacity

MARKETS DESTINATION

13%
Other
consumer
goods

Building

8%
Food

67%

Others

PULP MARKETS

DIFFERENT FIBERS, DIFFERENT MARKETS

KLABIN, THE PULP SOLUTION

EUCALYPTUS PULP
BEKP IN BALES

PINE PULP
BSKP IN BALES

LONG FIBER FLUFF IN

REELS

CONSISTENT PERFORMANCE

sep dec mar jun sep dec mar jun sep dec mar jun
11 11 12 12 12 12 13 13 13 13 14 14
LTM: Last twelve months

sep dec mar

14 14 15

jun sep dec mar jun

15 15 15 16 16

2.4

2,173

2.0

1.9

1,975

1.8

1,881

1.8

1,812

1.8

1.8

1.8

1,652

1.8

1,627

1.8

1,602

1.8

1,562

1.8

1,504

1.7

1,452

1.7

1,424

1.7

1,351

1.7

1,286

1.7

1,180

1.7

1,089

1.7

1.7 1,027

1.7 939

Excluding wood million tonnes

1,718

SALES VOLUME LTM

1,755

R$ million

2,026

Adjusted EBITDA LTM

2,238

21th QUARTER OF CONSECUTIVE GROWTH

sep
16

INCREASING FLEXIBILITY AND

INTEGRATION
NEW CORRUGATED BOXES UNITS
HEVI
Location: Manaus (AM)

INCREASE OF

KLABIN PRESENCE

IN DIFFERENT REGIONS

NO CLIENTS OVERLAP
NEW MARKETS

EMBALPLAN
Location : Rio Negro (PR)

70 THOUSAND TONNES

CAPACITY INCREASE

SHORT TERM STRATEGY

FOCUS ON DELEVERAGE

OPERATIONAL PERFORMANCE
CASH COST REDUCTION AND
FINALIZE RAMP UP

STRONG DOMESTIC POSITION

CONVERSION AND FLUFF MARKET

CAPEX

FOCUS ON MAINTENANCE AND

HIGH RETURN PROJECTS

IMPROVE CASH
GENERATION
AND
REDUCE
LEVERAGE

FUTURE GROWTH
EXPANDING THE INTEGRATED BUSINESS MODEL
TOTAL LAND

FIBERS

PAPER AND CONVERSION

489k hectares

3.5 million tpy

FUTURE GROWTH

PUMA PULP

1.1mi tpy
short fiber

long fiber &

fluff pulp

PLANTED FORESTS
230k hectares
PINE

140k

hectares

EUCALYPTUS

90k

hectares

INTEGRATED
PULP
1.8mi tpy

RECYCLED FIBERS

265 THOUSAND TPY

* Installed capacity

FOCUS IN PAPER AND

0.4mi tpy

PACKAGING
COATED
BOARDS
750k
tpy
CONTAINERBOARDS
1.25mi tpy

CORRUGATED
BOXES
750k tpy

INDUSTRIAL
BAGS
170k tpy

3Q16 RESULTS

SALES VOLUME, NET REVENUE

AND EBITDA
SALES VOLUME

NET REVENUE

Excluding wood- tsd tonnes

R$ million

787

1.446
33%

56%

463
33%
67%

3Q15

ADJUSTED EBITDA
R$ million

1.965
43%

585

EXPORTS

67%
44%

3Q16

57%

520

DOMESTIC
MARKET

3Q15

3Q16

3Q15

3Q16

PAPER

BUSINESS UNIT

COATED BOARDS
SALES VOLUME
tsd tonnes

172

39%

61%

NET REVENUE

SALES VOLUME

R$ million

tsd tonnes

106

181

42%

KRAFTLINER

528

74%

551

58%

EXPORTS

26%

DOMESTIC
MARKET
3Q15

3Q16

3Q15

3Q16

3Q15

94

77%

NET REVENUE
R$ million

226
174

23%
3Q16

3Q15

3Q16

CONVERSION

BUSINESS UNIT

SALES VOLUME

NET REVENUE

183

621

tsd tonnes

174

3Q15

R$ million

577

3Q16

3Q15

3Q16

PULP

NEW BUSINESS UNIT

SALES VOLUME

NET REVENUE

315

491

tsd tonnes

R$ million

87%

EXPORTS

0
3Q15

13%
3Q16

DOMESTIC
MARKET

0
3Q15

3Q16

CASH COST
UNIT
CASH COST

CASH COST
BREAKDOWN

R$/tonne

3Q16

3Q16

2,024

1,773

Fuel Oil
4%
Electricity
7%

Others
6%
Labor /
third parties
33%

Maintenance

/ stoppage
9%

Freight
12%

3Q15

3Q16

Chemicals
13%

Wood /
Fibers
16%

CAPEX

CAPEX

2013

2014

2015

2016E

maintenance

369

384

455

605

special projects and growth

231

319

129

153

99

2,242

4,053

1,745

899

2,945

4,627

2,503

R$ million

PUMA project
total

NET DEBT AND LEVERAGE

in 09/30/15

LEVERAGE
6.2

6.3
5.9
5.2

15,000

Net Debt (R$ million)

11,473
Sep-16

Mar-16

Dec-15

Sep-15

Dec-14

4,028
Sep-14

2,824
Jun-14

3,985

2,711
Mar-14

(1,000)

Dec-13

1,000

Sep-13

3,000

3,595

5,000

5,242

7,440

7,000

8,144

1.7

11,382

2.4
1.7

9,000

11,614

3.0

2.6

Jun-15

2.4

Mar-15

11,000

12,009

13,000

4.5
12,411

4.2

5.1

Jun-16

17,000

R$
17.4DEBT
billion AND
NET
R$ 5.8 billion
R$ 11.5 billion

Gross Debt
Cash
Net Debt

Net Debt/EBITDA (R$)

7.0
6.5
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5
-2.0
-2.5
-3.0
-3.5
-4.0

DEBT MATURITY

5,810

SOLID CASH POSITION

R$ million
2.748
2.495

2.402

2.321

1,554

2.094

1.722

1.545

R$ million

1.678

2,744 2.283

2,287

2,249

2,266

1,391

1,571

1,647

1.687

816

932
575

3Q16

1,895

1.439

212
429
129
84

146
3Q16

4Q16

278
115
163

266
4Q16

2016

1,189

858

666

596

678

2017

619

2017

2018

2019

2018

2020

2019

Local currency : R$ 5.6 billion

Average tenor: 40 months

390

426

502
526

2021

404

2020

2022

Gross Debt
17,192

713
770

773

896 651

2016

1.070

343

2021

2023

380
244
2022

2024

Gross Debt
17,889

Foreign
Currency
12,024

1,106

573

Cash
position

2,139

1.059

1,510

977

237
121
2Q16

1.300

1,569

1.468

358405

1.803

2,096

Foreign
Currency
12,508

323200
198
20231

2025/26

Foreign currency: R$ 12 billion

Average tenor : 50 months

Local 218
Currency
2275,168 216
1

2024

2025/26

Local
Currency
5,381

INVESTOR RELATIONS
www.klabin.com.br/ri
invest@klabin.com.br
+55 (11) 3046-8401

APPENDIX

GLOBAL PULP

INCREASING DEMAND IN BOTH FIBERS

LONG FIBER

SHORT FIBER

CAGR +2%

CAGR +3%
28.9

30.0

31.0

32.3

33.2

34.1

35.0
23.7

24.3

24.7

25.0

2014

2015

2016

2017

25.4

26.2

26.2

2018

2019

2020

Latin America
North America
Asia/ Africa
Europe
China
2014

2015

2016

Source: Hawkins Wright

Million tonnes per year

2017

2018

2019

2020

CHINA

LEADS THE GROWTH

FLUFF

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

SALES OF DIAPERS FOR ADULTS

SALES OF DIAPERS FOR INFANT

R$ million

R$ million

8,468
7,864

3,377
7,297

3,042

6,790

2,733

6,272
5,768

2,430

5,279

2,133
4,645

1,861

610

2009

1,183

4,827

4,000

1,605
1,005

9,139

3,398

1,363

788

2010

2011

2012 2013

Source : Euromonitor

2014

2015

2016

2017

2018

2019

2020

2009

2010

2011

2012 2013

2014

2015

2016

2017

2018

2019

2020

SPREADS AMONG DIFFERENT FIBERS

Fluff vs Fibra curta

US$/TONNE

Fibra Longa vs Fibra Curta

350

115

Jan/2013 Mai/2013 Set/2013 Jan/2014 Mai/2014 Set/2014 Jan/2015 Mai/2015 Set/2015 Jan/2016 Mai/2016 Set/2016
Source: RISI

PACKAGING MARKETS

FOCUS IN

LARGE AND GROWING

MARKETS

PAPER MARKETS DEMAND

(2014-2030)

Demand growth per year

4%

Tissue
KLABIN
Pulp

3%

Containerboards
KLABIN kraftliner and recycled paper

2%

Cartonboards
KLABIN coated boards

1%
Market B

0%

Market D

Market E
Sackpaper
KLABIN sack kraft and
industrial bags

-1%
-2%
Market C

-3% Market A

KLABIN MARKETS

-4%
0%
Source: POYRY

20%

40%

60%

Share of consumption in 2014

80%

100%

Jan-04
May-04
Sep-04
Jan-05
May-05
Sep-05
Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
Jan-15
May-15
Sep-15
Jan-16
May-16
Sep-16

US$/ton

COATED BOARDS
LOW VOLATILITY PRICES

1200

1100

1000
900

800

700

600

500

400

BHKP

Source : FOEX e RISI

*SBS Solid Bleached Sulfate folding carton USA
NBSK

*
Coated Boards

SUSTAINABILITY PERFORMANCE

WWF Environmental
Paper Company Index
Disclosing environmental footprint since 2006
2015 BEST PRACTICE OF NATURAL CAPITAL
MANAGEMENT

3rd CONSECUTIVE YEAR

WWF EPECI recognizes transparency

and continual improvement

One of the most sustainable

companies of Brazil

The company that advanced most in fighting

deforestation in supply chain 2014
Climate Change Score
Not

82%

95 disclosed
81

2015

Klabin
55

59

ISE

39

2013
2013

2011 2012 2013 2014 2015 2016

74,5%

2014

2015