You are on page 1of 9

2Q11 Earnings Release Conference Call

July 27, 2011

Legal Notice

The information contained in this presentation may include statements which constitute forward-looking statements, as defined by Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Such forward-looking statements involve a certain degree of risk and uncertainty with respect to business, financial, trend, strategy and other forecasts, and are based on assumptions, data or methods that, although considered reasonable by the company at the time, may be incorrect or imprecise, or may not be possible to realize. The company gives no assurance that expectations disclosed in this presentation will be confirmed. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward-looking statements, due to a variety of factors, including, but not limited to, the risks of international business and other risks referred to in the company’s filings with the CVM and SEC. The company does not undertake, and specifically disclaims any obligation to update any forward-looking statements, which are valid only for the date on which they are made.



2Q11 Performance

4 5 6 7 8

Competitiveness Project


Market Perception



The fundamentals of the pulp industry remain positive in the short term despite the challenges in the macroeconomic scenario
List Price – FOEX BHKP (US$/t) vs. BRL/US$ (rebased as 100)
105 100 95 90 -13.3% 85 May-11 Nov-10 Dec-10 Mar-11 Aug-10 Sep-10 Feb-11 Apr-11 Oct-10 Jun-10 Jan-11 Jun-11 Jul-10 -4.8%
Net Revenue (R$ million) EBITDA Pro Forma (1)(R$ million) EBITDA Margin (%) Financial Results (R$ million) Net Income (R$ million) 1,459 490 34% 277 215 1,548 607 39% 11 389 1,628 672 41% (310) 130 -6% -19% -5 p.p. -45% -10% -27% -7 p.p. 66% Pulp Production (‘000t) Pulp Sales (‘000t)

2Q11 Results
2Q11 1,271 1,230 1Q11 1,319 1,259 2Q10 1,164 1,214 2Q11 vs. 1Q11 -4% -2% 2Q11 vs. 2Q10 9% 1%

List Price (US$/t)


EBITDA Pro Forma(1) (R$ million) and EBITDA Margin (%)
41% 30% 672 607 490 39% 34%

Market Pulp Global Demand (%)
6M2011 x 6M2010


2% -3%


-5% Total North America Europe

Latin America


China 2Q10 1Q11 2Q11


Source: PPPC – World 20

(1) Excludes Conpacel and KSR results for the quarters under analysis

Fibria develops the Competitiveness Project in order to focus on operating excellence and initiatives to increase free cash flow generation
Actions for increased operating efficiency





Pulp Production ('000 t)
Production gain: +9% 1,271

2011 Capex reduction estimated in R$140 million New bleaching line of Plant A – Aracruz Unit Higher operating stability Optimization of wood transportation by barges – Aracruz Unit Energy Matrix – Jacareí Unit Global Sourcing




Cash Cost w/ downtimes (R$/t)
+3% (lower than Brazilian inflation: 462 +6.5%)

Rail Extension – Três Lagoas Unit Long-term international logistics contract (STX) Future Forestry Project
2Q10 2Q11


The approval of the Liability and Liquidity Management Policy reaffirms Fibria's focus on financial discipline
Key Indicators
2Q11 vs. 1Q11 2% 9% 0% 2Q11 vs. 2Q10 -21% 6% -27%

Liability and Liquidity Management Policy

(R$ million) Gross Debt Cash(1) Net Debt
(1) Includes




10,448 2,496 7,952

10,256 2,297 7,959

13,209 2,364 10,846

Objective: - Further strengthen the Company's commitment to achieve and sustain Investment Grade level

Highlights: - Leverage target: Net Debt/EBITDA: 2.0x to 2.5x - Leverage cap: 3.5x during growth cycle - Maintain the necessary liquidity to meet its operational and short term obligations

fair value of the derivatives

Net Debt / EBITDA(2) (x) Expected results:
4.7 2.9 3.2

- Access to competitive sources of funds - Attract a broader and more diversified investor base - Reduce the Company’s cost of capital




(2) Last

12 months EBITDA includes Conpacel and KSR results


Fibria's Bonds incorporate expectations similar to investment grade companies
Yield (%)
9,7 9,2 8,7 8,2 7,7 7,2 6,7 6,2 5,7 5,2 6,8 6,6 6,4 6,2 6 5,8 5,6 5,4 5,2 Mar-11 Apr-11 May-11 Jun-11





Fibria’2021 Moody’s Fitch S&P

Rating Ba1/positive BB+/stable BB/positive 7

A change on the forestry base model will reduce the necessary investment to growth projects
Três Lagoas II Veracel II

Public Audience for obtaining the social and environmental license held on June 9 Forestry Base : - Total area: 230,000 ha - Planted area: 150,000 ha Status:

Forestry Base: - Total area: 220,000 ha - Planted area: 120,000 ha

Environmental Licensing in progress

Negotiation between partners in satisfactory progress

• • •

Três Lagoas I surplus: 30,000 ha of effective planting Leasing: 70,000 ha of effective planting Change on the forestry base model: leased areas increased to 70%

Start up: 2014


IR Team: Website: E-mail: Phone: +55 11 2138-4565