j.p. morgan brazil opportunities conference
TRANSCRIPT
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J.P. Morgan Brazil Opportunities ConferenceDecember, 2014
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2
The information contained in this presentation may include statements whichconstitute forward-looking statements, within the meaning of 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 turn out to 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
speak only for the date on which they are made.
Disclaimer
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Company Overview1Pulp and Paper Market2
Financial and Operational Highlights3
Agenda
Final Remarks
4
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Company Overview
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A Winning Player
Port Terminal Pulp Unit
Três Lagoas
Santos
AracruzPortocel
Caravelas
BelmonteVeracel
Jacareí
Superior Asset Combination Main Figures – 3Q14 LTM
Pulp capacity million tons 5,300
Net revenues R$ billion 7.0
Total Forest Base(1) thousand hectares 970
Planted area(1) thousand hectares 562
Net Debt R$ billion 7.3
Net Debt/EBITDA (in Dollars)(2) X 2.5
Net Debt/EBITDA (in Reais) X 2.7
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.
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Fibria’s Units Industrial Capacity
* Veracel is a joint venture between Fibria (50%) and Stora Enso (50%) and the total capacity is 1,120 thousand ton/year
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Worldwide presence
Strong global customer base
Long-term relationships
Focus on customers with stable business
Customized pulp products and services
Sound forestry and industrial R&D
Focus on less volatile end-use markets such as tissue
Efficient logistics set up
Low dependence on volatile markets such as China
Low credit risk
100% certified pulp (FSC and PEFC/Cerflor)
Sales Mix by End Use - Fibria
Sales Mix by Region - Fibria
Europe
39%
N.
America
26%
Asia
25%
Other10%
Region - 3Q14
Tissue
55%
Printing &
Writing
27%
Specialty
18%
End Use - 3Q14
Highlights
30%20%
29% 29% 24%18%
26% 26% 30%22%
28% 31% 30%19% 22% 26%
37%46%
46% 41%
35% 44%
43% 41% 36%42%
43% 35% 36%46% 42% 39%
22% 25%14% 20%
31% 28%20% 23% 25% 26%
21% 26% 26% 26% 27% 25%
11% 9% 11% 10% 10% 10% 11% 10% 9% 10% 8% 8% 8% 9% 9% 10%
4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14
North America Europe Asia Other
Fibria’s Commercial Strategy
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(1) Controlling group
(2) Free Float 40.14% + Treasury 0.06%
VotorantimIndustrial S.A.
(1)
29.42%
BNDESParticipações (1)
30.38%
FreeFloat (2)
40.20%
• Only 1 class of shares →100% voting rights
•
100% tag along rights (Brazilian corporate law establishes 80%)
• Board of Directors with minimum 20% independent members
• Financial Statements in International Standards – IFRS
• Adoption of Arbitration Chamber
• SEC Registered ADR Level III program
• Indebtedness and Liquidity
• Market Risk Management
• Risk Management
• Corporate Governance
• Related Parties Transactions
• Anti-Corruption
• Information Disclosure
• Securities Trading
Fiscal
Council
Board of
Directors
20% independentmembers
Role of CEO andchairman is split
Personnel andRemuneration
Committee
StatutoryAudit
Committee
Finance
Committee
Sustainability
Committee
Innovation
Committee
General
Meeting
Listed on Novo Mercado, highest CG level at BM&FBovespa: Policies approved by the Board of Directors:
Shareholder Structure and Corporate Governance
30%independent
members
100%independent
members
50% independent
members
45% independent
members-
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9Pulp and Paper Market
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Today, according to public information, there will be a 10% increase of the
pulp market capacity between 2014 and 2016
SOFTWOOD(1)
25.5 MT
HARDWOOD(1)
31.1 MT
MARKET PULP(1)
56.6 MT+ =
2014-2016(3):
• New capacities: 6.0 mt
• Announced Closures: (1.0) mt
Net: 5.0 mt
2014-2016(2):
• New capacities: 0.7 mt
• Announced Closures: (0.4) mt
Net: 0.3 mt
2014-2016:
• New capacities: 6.7 mt
• Announced Closures: (1.4) mt
Net: 5.3 mt
(1) Source: PPPC Special Research Note May 2014 – does not include Sulphite and UKP
(2) Projects included: Paper Excellence (70kt); UPM Kymi (170kt); Klabin (200kt); Sodra Värö (275kt)| Closures: Birla AV Terrace Bay (350kt)
(3) Projects included: Maranhão (1.5mt); Montes del Plata (1.3 mt); Oji Nantong (700kt); Eldorado (200kt); CMPC Guaíba II (1.3 mt); Klabin Ortigueira (1.0mt) | Closures: April Rizhao
(130kt); Arauco Valdivia (300kt); Old Town (200kt); Ence Huelva (400 kt).
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Global Market Pulp Demand
Demand growth rate
Hardwood (BHKP) vs. Softwood (BSKP) (000 ton)
Hardwood demand will continue to increase at a faster pace than Softwood
Source: PPPC
Source: PPPC. Excludes Sulphite and UKP market pulp.
NBSK vs. BHKP - Prices(1)
(1) Source: FOEX |Average spread in the last 5 years.
0
5.000
10.000
15.000
20.000
25.000
30.000
35.000
1 9 9 8
1 9 9 9
2 0 0 0
2 0 0 1
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
2 0 0 8
2 0 0 9
2 0 1 0
2 0 1 1
2 0 1 2
2 0 1 3
2 0 1 4
2 0 1 5
2 0 1 6
2 0 1 7
2 0 1 8
Hardwood Softwood
2013 - 2018 CAGR:
Hardwood: +2.8%
Softwood: +0.7%
000 ton 1998 2008 2018Growth1998-2008
Growth2008-2018
Hardwood 15.0 24.5 32.8 63% 34%
Eucalyptus 6.0 14.2 23.4 137% 63%
Softwood 17.6 21.6 24.8 23% 15%
Market Pulp 32.6 46.1 57.1
Paper Production – Runnability with BHKP
Source: RISI conference, August 2014.
400
500
600
700
800
900
1000
1100
0
50
100
150
200
250
Spread Average spread BHKP NBSK
Average spread:
US$112
Spread Nov/14:
US$197
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Supply structural changes puts pressure on the industry
MARKET PULP CAPACITY RANKING 2014 (000T) MAIN PROJECTS
Project Country Capacity Timing Fiber Status
CMPC Guaíba II Brazil 1.3 Mt 2Q2015 BEKP Confirmed
Klabin Paraná Brazil 1.5 Mt 2Q2016BEKP/
BSKP/Fluff Confirmed
APP South Sumatra Indonesia 2.0 Mt 1Q2017 BHKP Confirmed
Fibria Três Lagoas II Brazil 1.75 Mt - BEKP Unconfirmed
COST CURVE EVOLUTION
U S D
/ A d t , 2 0 1 3 c o s t l e v e l
Cumulative Capacity Million t/a
Cost positionof marginal
producer
Source: Hawkins Wright , Poyry and Fibria Analysis (as of Aug. 2014).
0 2000 4000 6000
Canfor
ENCE
Eldorado
Resolute Forest
Domtar
Mercer
Sodra
Ilim
IP
Weyerhaeuser
Metsa Group
Paper Excellence
Stora Enso
UPM-Kymmene
CMPC
Georgia Pacific
Suzano
Arauco
APRIL
Fibria
Bleached Softwood Kraft Pulp (BSKP)
Bleached Hardwood Kraft Pulp (BHKP)
Unbleached Kraft Pulp (UKP)
Mechanical Pulp (MP)
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Gross capacity addition should not be counted as the only factor
influencing pulp price volatility….(1)
List Price bottoming at US$650/t in 2011 and US$724/t in 2014
C a p a c i t y ( 0 0 0
t o n )
0,0
0,2
0,4
0,6
0,8
1,0
1,2
1,4
1,6
1,8
2,0
0
100
200
300
400
500
600
700
800
900
1.000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Valdivia
APP
Hainan
Veracel Nueva Aldea
Santa Fé
Mucuri
Fray
Bentos
Kerinci
PL3
Três
Lagoas
Rizhao
APP Guangxi
Chenming
Zhanjiang
Eldorado Montes
del Plata
Maranhão
Guaíba II
APP South
Sumatra (2)
Klabin
B H K P
p r i c e s - C I F E u r o p e
( U S $ / t o n )
(1) Source: Hawkins Wright , Poyry and Fibria Analysis. Pulp price estimates according to Hawkins Wright (Sep/14), Brian McClay(Nov/14) and RISI (Nov/14)(2) Partially integrated production
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Technical Age and Scale in the Market Pulp IndustryFurther closures are expected due to lack of adequate investments in the industry…
Hardwood (BHKP) Market Pulp Softwood (BSKP) Market Pulp
STRONGWeighted average
technical age 12.3 years
Weighted average
capacity 1,277,000 t/a
Aracruz
Três La go as
Veracel
Jacareí
0
500
1.000
1.500
2.000
2.500
3.000
051015202530
PM Capacity, 1000 t/a
Technical Age, years
WEAK
STRONGWeighted average
technical age 21 years
Weighted average
capacity 527,000 t/a
North American Pulp Mills Other Pulp Mills Closures Grade Switch On & Off
WEAK0
500
1.000
1.500
2.000
2.500
3.000
0102030
PM Capacity, 1000 t/a
Technical Age, years
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Source: PPPC and Fibria
Closures of Hardwood Capacity Worldwide
(000 ton)
Capacity closures DO happen
-910
-85
-1,260-1,180
-540 -500
-105
-1,085
-830
2006 2007 2008 2009 2010 2011 2012 2013 2014-2016 Eas of Oct14
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Lowest Volatility Among Commodities
Change Nov/2014 vs. Nov/2013(3)
Commodities Historical Volatility (US$)(1)
36%33%
28%26%
24% 23%
15%
7%
Sugar Iron Ore WTI Crude
Oil
Soy LME Metals Ibovespa Cattle FOEX PIX
BHKP
Sugar Iron Ore Crude Oil SoyLME
MetalsIbovespa Cattle Pulp BHKP
Commoditiy Spot Price -7% -49% -21% -21% - - 28% -5%
S&P Sector Index(2) -7% -22% -17% -21% 2% 7% 28% -
FIBR3|FBR - - - - - - - 7%|-3%
(1) From 2009 to Dec 1,2014 | (2) Except Iron Ore (Average Vale, Rio Tinto and BHP) and LME Metals | (3) November, 26th
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Total Cash Cost of BHKP delivered to Europe (US$/t)
Source: Hawkins Wright (Outlook for Market Pulp, September 2014) | Fibria’s 3Q14 considering a FX of R$/US$2.27.
Gray bar includes cash expenses as Interest, CAPEX, SG&A and Taxes (Source: RISI and Fibria).
3Q14 net price:
US$ 554/t
Positive Working
Capital: US$5/t
SG&A
Capex
Interest
Among the industry’s lowest cash cost producers
498 508456 468
420 404 424 424 406342 315 311 297
235 221
71 46
69 41 86 12134 38 41
4855 38 67
11166
54
142
24
Cash Cost (US$/t) Delivery (US$/t)
Income Tax1
Interest
Capacity
(k tons):1,775 660 595 570 1,570 1,045 2,415 335 625 340 7,450 = 31,3853,745 1,010 3,950 5,300
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Shipments of Eucalyptus Pulp (1)
(1) Source: PPPC World 20 – December/2013
6%
12%
-1%
23%
Total North America Western Europe China
+844 kt -37 kt
+674 kt
+185 kt
2013 vs. 2012 10M2014 vs. 10M2013
+1,400 kt
+60 kt +255 kt
+680 kt+403 kt
11%
4% 5%
25%
12%
Total North
America
Western
Europe
China Other
Global Market BEKP Demand
Ktons 2013 2014E 2015E Total
P&W (woodfree) 385 150 576 1,111
Tissue 1,029 1,831 471 3,331
Cartonboard 2,128 1,616 180 3,958
Total 3,542 3,631 1,227 8,400
Paper Capacity increase in China
(1) Source: PPPC World 20 – October/2014
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World Tissue Consumption, 1991-2013 (3)
Per Capita Consumption of Tissue by World Region (3)China's Share of Market Pulp (2)
24
15 15
12
7 65
1
0
5
10
15
20
25
30
N.
America
West
Europe
Japan Oceania East
Europe
LatAm China Africa
9 11 1316
26
1721 20
23
79 10
12
22
1620 19
2110
1012
14
21
17
2223
23
0
2.000
4.000
6.000
8.000
10.000
12.000
2005 2006 2007 2008 2009 2010 2011 2012 2013
Eucalyptus Hardwood Total
5.988
2.436
1.482 1.713
184 12747
6.403
3.037
1.593 1.592
141 2613
0
1.000
2.000
3.000
4.000
5.0006.000
7.000
BHKP Total Latin
America
Indonesia Other* USA Canada Western
Europe
9M2013 9M2014
Latin America is the
leading exporter of BHKP
to China, accounting toapproximately 47% of
China's total imports in
9M2014.
(Kg/capita/year)
(million t)(‘000s t) (kg/person/year)
Between 2005 and 2013,
the Chinese market share
of eucalyptus shipments
increased by 14 p.p.
(total market pulp: + p.p.)
* includes Russia, China, Thailand and New Zealand
0
5
10
15
20
2530
35
1991 1996 2001 2006 2009 2010 2011 2012 2013
N.America W.Europe E.Europe L.America
Middle East Japan China Asia FE
Oceania Africa
LTM Growth
Rate +4.2%
Benefiting From China’s Growth
China’s Hardwood Imports of BHKP by Country (1)
(1) PPPC – Pulp China
(2) PPPC – W20. Coverage for chemical market pulp is 80% of world capacity(3) RISI
(In percentage)
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3Q14 Results
Cash Production Cost (R$/t)
Pulp Production and Sales (‘000 t) Net Revenue (R$ million)
EBITDA (R$ million) and EBITDA Margin (%)
1.347
1.271
1.3451.301
1.334
1.372
3Q13 2Q14 3Q14
Production Sales
1.841
1.694 1.746
3Q13 2Q14 3Q14
482 486 478501
559502
3Q13 2Q14 3Q14
Cash cost ex-scheduled downtimes Cash cost
762
594 613
3Q13 2Q14 3Q14
41%35% 35%
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Indebtedness
Net Debt (Million) Total Debt and Interest Expenses (Million)
Net Debt/EBITDA (US$)Net Debt/EBITDA (R$)
Debt Amortization Schedule (R$ million) Average Tenor (months) and Cost of US$ Debt (%p.a.)
3,02,3
2,7
2,92,4
2,5
8.240
6.6817.313
3.6953.033 2.984
Sep/13 Jun/14 Sep/14
R$ US$
9.4878.457 8.574
4.254 3.840 3.498
Sep/13 Jun/14 Sep/14
R$ US$
6349 50
- 18%
Interest (US$)
1.261
1.536
2.797
560
888 842
1.353 1.2581.041
616511
49 6
1.449
Liquidity 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Pre-payment BNDES ECN ACC/ACE Voto IV Bonds
(cash)
(revolver)
Early redemption
bond 20194,5
3,8
4,0
3,8
54 5255 57
Sep/13 Jun/14 Sep/14 Dec/14
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Fibria delivers one of the highest EBITDA/t and FCF/t of the industry
Free cash flow generation - 3Q14 LTM (R$ Million)
Free Cash Flow per ton - 3Q14 LTM (R$/ton)(1)
2,708
1,119
(1,509)(370)
317
(20) (7)
Adjusted EBITDA Capex Interest(paid/received) Working Capital Taxes Other Free Cash Flow
507
210
(283)(69)
59
(4) (1)
Adjusted EBITDA Capex Interest
(paid/received)
Working Capital Taxes Other Free Cash Flow
(1) Does not include: asset sales, expenses on bonds repurchase, expenses related to the REFIS on subsidiaries profits abroadand tax credits from theBEFIEX program.
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FX and Pulp Price explain 80% of Fibria’s EBITDA Margin
(1) Excludes Conpacel | (2) 2014 year end market consensus | (3) According to Focus Report (Brazilian Central Bank – Nov/2014) | (4) According to Poyry – full cost estimate - includes Manufacturing +Delivered costs to Rotterdam + Depreciation + ROCE of 9%
Each 10% depreciation of the Real increases EBITDA by approx. R$600 million
1,522
2,526
1,9642,253
2,796 2,708
2009 (1) 2010 (1) 2011 2012 2013 LTM 3Q14 2015
2.001.76
1.671.95
2.102.29 2.59(3)
Exchange Rate
Average (R$/US$)
EBITDA Margin
EBITDA (R$ million)
29%40% 34% 36% 40% 38%
Marginal producer cost
(US$/t)(4)
Fibria net pulp price
(US$/t)
Market
Consensus456
670639
581610 572
556
660627
676657
680 676
912
1,1791,067 1,133 1,281
1,310 1,440
Fibria net pulp price
(R$/t)
Capital Structure: Fibria has achieved the lowest leverage ratio among
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Net Debt/EBITDA (x)(1)
Fibria Arauco CMPC Klabin Suzano
S&P BB+/Positive BBB-/Stable BBB+/Negative BBB-/Negative BB/Stable
Moody’s Ba1/Positive Baa3/Stable Baa3/Negative - Ba2/Stable
Fitch BBB-/Stable BBB/Stable BBB+/Stable BBB-/Negative BB/Stable
(1) Fibria’s historical data in BRL. | (2) Market consensus.
Capital Structure: Fibria has achieved the lowest leverage ratio among
its Latin American peers
2.4 2.3
2.72.6
4.84.5 4.5
4.2
1.7 1.7
2.4
2.72.93.1
3.13.7
3.6 3.7 3.6
14.813.2
11.711.1
4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 2014
Fibria Suzano Klabin CMPC Arauco Eldorado
2
A consistent and disciplined approach focused on reducing debt
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A consistent and disciplined approach focused on reducing debt
and its cost
Debt (US$ million) x Leverage (US$) Interest (US$ million) x Cost of Debt (US$)
Free Cash FlowIncrease
InterestReduction
Cost of DebtReduction
This dynamicscreates a virtuous
cycle
8.6
3.5
6.3
3.0
2009 2010 2011 2012 2013 Sept/2014
Gross Debt Net Debt
7.5
4.1 4.23.3
2.6 2.5473
414 408350
268217
2009 2010 2011 2012 2013 LTM 3T14
6.3 5.95.5
5.2 4.6 3.7
Continuation of the liability management plan also focusing on
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Continuation of the liability management plan, also focusing on
improving maturities…
1,064
384 530 750 554 634
2,020
1,341
-
410
450 299
506422 128
149
100
1,473
834 829
1,255
976 762
2,168
1,441
264
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Cost of debt: 4.6%
Average maturity: 52 months
December 2013
Local CurrencyForeign Currency
September 2014
Cost of debt: 3.7%
Average maturity: 55 months
Local CurrencyForeign Currency
Land Deal
Bond buyback: Fibria 2020,2021 and VOTO IV
Fibria 2024 issuance
Bank loans renegotiations
Lower cost of debt
Smoother debt amortization
schedule
Estimated NPV of allinitiatives until the endof 2014: US$300 million
183 173 210335 332 369
178 153
59145
190 133
217 181 56
73 56
228
363 343
552 513 425
251 208
20 3
591
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
But the initiatives have not finished There are certain ongoing
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30
… But the initiatives have not finished. There are certain ongoing
negotiations that will improve Fibria’s debt profile even further
30
514
(cash)
627
(revolver)
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Others ACC/ACE ECN BNDES Bond EPP
FCF 3Q14 LTM: US$489 million
Amortization Schedule – Pro-forma Dec/14 - US$ mn
▶ Repurchase of costly debt
▶ Issuance of a Syndicated EPP (US$400 MM)- full commitment
▶ Tranche A: L + 1.30% p.a| 5-y
Cost reduction of 32.5 bps from our last EPP.
▶ Tranche B: L + 1.40 p.a | 5-y bullet
Average term increase of 1 year and cost reduction of 22.5 bps from our last EPP.
▶ Tranche C: L + 1.55% p.a | 6-y
Average term increase of 1.5 years and cost reduction of 7.5 bps from our last EPP.
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31
New issuance better priced than Investment Grade issuers
Rating Maturity Volume T-Spread Coupon X Book
Fibria Ba1 / BBB- / BB+ 2024 US$600 mn 275 bps 5.25% 11.5x
Braskem Baa3/BBB-/BBB- 2024 US$500 mn 340 bps 6.45% 11.0x
Petrobras Baa1/BBB/BBB 2024 US$2.5 bn 350 bps 6.28% 3.3x
Klabin BBB-/BBB- 2024 US$500 mn 269 bps 5.25% 6.0x
Samarco BBB-/BBB 2024 US$500 mn 288 bps 5.375% 3.6x
Rating Maturity Volume G-Spread Yield
Fibria Ba1 / BBB- / BB+ 2024 US$600 mn 289 bps 5.047%
Braskem Baa3/BBB-/BBB- 2024 US$500 mn 362 bps 5.742%
Klabin BBB-/BBB- 2024 US$500 mn 332 bps 5.490%
Odebrecht Baa3/BBB-/BBB 2023 US$800 mn (1) 297 bps 5.017%
Petrobras Baa1/BBB/BBB 2024 US$2.5 bn 368 bps 5.817%
Gerdau Baa3/BBB-/BBB- 2023 US$750 mn 308 bps 5.130%
Samarco BBB-/BBB 2024 US$ 500 mn 366 bps 5.848%
(1)
Outstanding: US$102 mn
Secondary Market - As of Nov 28, 2014
Issuance
Cash Production Cost saw a annual increase
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Fibria Cash Production Cost (1) (R$/ton)
Consistently
controlling the
production cashcost at a level
below the
inflation pace
32
Cash Production Cost saw a annual increase
of 3.7% over the past 6 years
(1) Excludes Conpacel.
432 448
471 473
505 518
2009 (2) 2010 (2) 2011 2012 2013 3Q14 LTM
CAGR: + 3.7%
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33
Fibria has the simplest and most transparent call in the industry
Negative Neutral Positive
Pulp supply ✔
Closures/conversions ✔
Inefficient capacities in China ✔
Demand ✔
‣ Fiber and grade substitution ✔
‣
Tissue ✔‣China ✔
Pulp price ✔
Brazil GDP ✔
Energy crisis ✔
FX ✔
Capex inflation ✔
Cost inflation ✔
Rating ✔
Tax ✔
Corporate Governance ✔
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34Final Remarks
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35
PULP
- Growth with discipline
- Best portfolio of projects
BIO-ENERGY
- Complementary to pulp
- Ensyn
INDUSTRY
CONSOLIDATION ?
OTHER OPPORTUNITIES
- Portocel
- Land and forest
PotentialGrowth
Prospects
Fibria is seeking value creation for its shareholders with capital discipline
The maturity of synergies captured since Fibria’s creation improved its
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36
593 593 605 584648 649
900826
766678 699
2009* 2010* 2011 2012 2013 3Q14 LTM
4,600
5,0545,184
5,299 5,271 5,251
2009* 2010* 2011 2012 2013 3Q14 LTM
The maturity of synergies captured since Fibria s creation improved its
operating indicators…
+14%
PRODUCTION VOLUME (000 t)BEST PRACTICES AND OPERATING STABILITY
Historical Value Inflation Effect**
-21%
CASH COST (R$/ton)
Historical Value Inflation Effect**
-28%
SG&A (R$ million)STRUCTURE AND PROCESS SIMPLIFICATION
1,522
2,5261,964
2,253
2,796 2,708
2009* 2010* 2011 2012 2013 3Q14 LTM
29%
40%34% 36%
40% 38%
EBITDA (R$ million) - EBITDA MARGIN (%)
* Excludes Conpacel | ** IPCA index considered to calculate the inflation effect
432 448 471 473 505 518
656 624 596549 545
2009* 2010* 2011 2012 2013 3Q14 LTM
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37
Key Highlights
Sound credit profile, with decreasing leverage ratios
Market leader with a highly profitable operation and cash cost
below industry average
Highly experienced and qualified management team
Highly recognized and awarded by industry specialists
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38Back up
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Due to productivity gains in its forests, Fibria had the opportunity to
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40
p y g , pp y
explore this new ownership model
MAI* Pulp:(adt/ha/year)
10.6 10.9
12.1
15.0 15.0 15.0 15.0 15.0
2010 2015 2020 2025 2030 2035 2040 2045
FIBRIA’S GAINS IN IMACEL DUE TO INVESTMENTS IN BIOTECHNOLOGY (TONS OF PULP/HA/YEAR)
2012 field trials = 11.9
Conservative assumption
*MAI: Mean annual increment
Actions:• Genetic improvement
• Excellence in forestry management
• Superior industrial efficiency
d hi i i
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41
Leadership position
(1) Fiber Consumption, Recycled Fiber and Pulp: RISI | Market Pulp, Hardwood and Eucalyptus: PPPC Special Research Note - May 2014
Recycled Fiber
234 million t
49% 51%
60%
18% 82%
58% 42%
40%
35% 65%
29%71%
Fiber Consumption
403 million t
Pulp
169 million t
Chemical
139 million t
Mechanical
31 million t
Integrated Mills
84 million t
Market Pulp
56 million t
Hardwood
29 million t
Other Eucalyptus
Pulp producers:
13 million t
Softwood/Other
27 million t
Acacia/Other
10 million t
Eucalyptus
19 million t
Industry Outlook(1)
Gl b l P C i
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Global Paper Consumption
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
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
CAGR 1996 – 2006
Developed Markets: + 1.7%
Emerging Markets : + 6.0%
85,291
117,611
15,548
37,474
P&W
Consumption
(000 tons)(1)
Tissue
Consumption
(000 tons)(1)
114,507
CAGR 2007 – 2016
Developed Markets: - 4.0%
Emerging Markets : + 4.1%
CAGR 1996 – 2006
Developed Markets: + 2.4%
Emerging Markets : + 6.9%
CAGR 2007 – 2016
Developed Markets: + 1.4%
Emerging Markets : + 6.7%
26,877