EMPRESAS CMPC PRESENTATION PREPARED FOR SANTANDER S 20 TH ANNUAL LATIN AMERICAN CONFERENCE - CANCUN LUIS LLANOS CFO COLOMBA HENRÍQUEZ HEAD IR

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1 EMPRESAS CMPC PRESENTATION PREPARED FOR SANTANDER S 20 TH ANNUAL LATIN AMERICAN CONFERENCE - CANCUN LUIS LLANOS CFO COLOMBA HENRÍQUEZ HEAD IR

2 AGENDA I. Company description II. Our value proposal 1. Leading diversified Latin American P&P player 2. Low cost producer with world class assets 3. Strong balance sheet and financial track record 4. Committed to Sustainable Development and Corporate Governance 5. Investment portfolio in high growth potential businesses III. IV. Challenges Appendix

3 CMPC AT A GLANCE CMPC is a P&P company, established in 1920, that produces solid wood products, pulp, paper, packaging products and tissue in Latin America CMPC s Figures Sales: 4,802 EBITDA: 1,031 Net Income: (51) Net Debt: 3,582 Assets: 14,792 P&P main companies by market capitalization 20.6 Market capitalization of US$5.4 billion as of December 31 st, Controlled by the Matte Family, one of Chile s leading economic groups Shareholders Structure* Chilean and Foreign Investors 34% Chilean Pension Funds 11% Matte Group 56% Figures for the LTM as of Sept (US$ million) International rating BBB+ (Fitch) BBB- (S&P) Baa3 (Moodys) Local rating AA (Fitch) AA (ICR) Operations in 8 countries, selling to more than 45 countries *As of December 31 st Source: Bloomberg *As of December 31 st, Source: CMPC ~16,800 Employees worldwide 3

4 AGENDA I. Company description II. Our value proposal 1. Leading diversified Latin American P&P player 2. Low cost producer with world class assets 3. Strong balance sheet and financial track record 4. Committed to Sustainable Development and Corporate Governance 5. Investment portfolio in high growth potential businesses III. IV. Challenges Appendix

5 1. LEADING DIVERSIFIED LATIN AMERICAN P&P PLAYER

6 Tissue Papers Pulp Forestry A DIVERSIFIED BUSINESS PORTFOLIO PROVIDES CMPC A STABLE CASH FLOW Main Figures % of third parties total sales % of consolidated EBITDA Total capacity & Employees Sales: 947 Sales 3 rd parties: 560 EBITDA: 179 EBITDA margin: 19% 12% 17% 650 Th. has. planted 15.4 M m 3 /y harvested 1.7 M m 3 /y solid wood 2,607 employees US$5.8 billion in assets Sales: 1,826 Sales 3 rd parties: 1,484 EBITDA: 514 EBITDA margin: 28% 31% 50% 4.1 M tons/y 2,232 employees US$5.5 billion in assets Sales: 990 Sales 3 rd parties: 932 EBITDA: 143 EBITDA margin: 14% 19% 14% 1.3 M tons/y 3,636 employees US$1.4 billion in assets Sales: 1,828 Sales 3 rd parties: 1,826 EBITDA: 217 EBITDA margin: 12% 38% 21% 657 Th. tons/y 8,418 employees US$2 billion in assets Source: CMPC. Figures in US$ million for the LTM as of September 2015 / Figures do not include sales between CMPC affiliates or subsidiaries 6

7 CMPC HAS EVOLVED FROM A LOCAL COMPANY TO A GLOBAL PLAYER CMPC has expanded significantly through Latin America over the last two decades 11x asset growth since 1990 (before CMPC s international expansion process) 5,000 Sales Breakdown Evolution (Million US$) 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Source: CMPC Domestic Sales in Chile Export Sales Domestic Sales Foreign Subsidiaries Forestry Operations Pulp Operations Paper and Packaging Operations Tissue Operations 7

8 CMPC HAS A PRODUCT AND GEOGRAPHIC DIVERSIFICATION OF SALES THAT PROVIDES FLEXIBILITY Operations in 8 countries, selling in more than 45 countries Plywood 10 largest customers represent ~ 15% of consolidated sales Besides Chile, there is no single country that represents more than 15% of consolidated sales Source: CMPC. Figures in US$ million for the LTM as of September 2015 / Figures do not include Holding and Intercompany Sales. 8

9 2. LOW COST PRODUCER WITH WORLD CLASS ASSETS

10 CMPC BENEFITS FROM ITS PRODUCTION COST EFFICIENCIES AND WORLD CLASS ASSETS Access to low cost fiber Research and Development to enhance efficiency, productivity and customer satisfaction State of art facilities strategically located Energy investments based in biomass and cogeneration 10

11 Russia Scandinavia Canada USA Chile E. Globulus Iberian E. Globulus Chile Acacia Mangium Eucalyptus Brazil E. Nitens Chile HIGH YIELD FORESTRY ASSETS THAT PROVIDE LOW COST FIBER RESOURCES 650,000 Planted hectares 473,300 Chile 120,400 Brazil * 56,300 Argentina CMPC Forest Base is FSC TM Certified Over 1 million hectares of land CMPC has a high quality and sustainable forestry base with fast growth cycles which optimizes capital invested in land, reduces average distance to mills and increases gains due to genetic and sylvicultural practices Radiata Pine Average softwood growth rate (m 3 ssc/ha/year) Eucalyptus Average hardwood growth rate (m 3 ssc/ha/year) Improvement in Forestry Yields ** 23% 32% % 3% 9% 14% P ** Evolution of the weighted increase of volume per hectare expected for eucalyptus and pine plantations established in Chile in the respective year Source: CMPC. *There is an agreement to acquire from Fibria aprox. 100 Th. hectares of which 39 Th. are planted. CMPC is waiting the approval of Brazilian authorities to consolidate this land ** m 3 ssc: solid m 3 without bark 11

12 (US$/Ton c.i.f. N. Europe) (US$/Ton c.i.f. N. Europe) CMPC S CASH COSTS ARE AMONG THE LOWEST OF THE PULP INDUSTRY GLOBALLY CMPC s average distance from to Plantations 80 Km. Laja BSKP 340 th. tons 93 Km. (by train) Ports 208 Km. Guaíba BEKP th. tons 260 Km. (by barges) 93 Km. Pacífico BSKP 500 th. tons 163 Km. (by train) Source: CMPC 99 Km. BSKP 1 Supply Curve (US$/ton) BHKP 2 Supply Curve (US$/ton) CMPC s pulp facilities ,000 10,000 15,000 20,000 25,000 ( Thousand metric tonnes) Santa Fe BEKP th. tons 119 Km. (by train) CMPC s pulp facilities 0 0 5,000 10,000 15,000 20,000 25,000 30,000 (Thousand metric tonnes) Source: CMPC and Hawkins Wright as of December 2015 (1) BSKP: Bleached Softwood Kraft Pulp (2) BHKP: Bleached Hardwood Kraft Pulp 12

13 CMPC IS FOCUSING ON ENERGY EFFICIENCY AND RENEWABLE ENERGY SOURCES CMPC is constantly investing in energy generation based on biomass and cogeneration to further lower its cost base and its dependency from the electric market Current Cogeneration Projects Puente Alto Mill (3Q15): 50MW + 80 tons steam/hour Talagante Mill (4Q15): 21MW + 25 tons steam/hour Altamira Mill (4Q15): 21MW + 30 tons steam/hour Source of Energy Consumption in CMPC 2014 (91,327 Terajoules) Energy Balance in Chile Plywood GWh Consumption Generation Natural Gas Oil 7% 6% Electric Energy 7% Coal 6% Others 1% 3,500 3,000 2,500 2,000 1,500 1,000 Source: CMPC Biomass 74% R 2015 F 2016 F Forestry Pulp Papers Tissue 2014 R 2015 F 2016 F Generation Contracts 13

14 3. STRONG BALANCE SHEET AND FINANCIAL TRACK RECORD

15 x 7.00x 6.00x 5.00x 4.00x 3.00x 2.00x 1.00x 0.00x 1,200 1, % 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% KEY FINANCIAL FIGURES AS OF SEPTEMBER 30 TH 2015 Sales Evolution (US$ million) EBITDA and EBITDA Margin Evolution (US$ million) 4,786 4,759 4,974 4,900 4,802 1, ,031 22% 19% 19% 20% 21% LTM Plywood LTM Source: CMPC Financial Debt / Equity (Covenant: <0.8x) 0.56x 0.48x 0.48x 0.43x 0.53x Source: CMPC Interest Coverage Ratio (Covenant: >3.25x) 6.80x 5.45x 5.67x 5.31x 5.51x Q Q15 Source: CMPC Source: CMPC 15

16 DEMONSTRATED CAPACITY TO MANAGE LEVERAGE Net Debt / EBITDA 5.0 Acquisition of Pacífico and Santa Fe I Santa Fe II Investment Period Guaíba I Acquisition Guaíba II Investment Period Source: CMPC 16

17 CMPC S DEBT PROFILE AS OF SEPTEMBER 30 TH 2015 Debt Profile Average term: 6.6 years Total Debt: US$4,149 million Cash: US$567 million Net Debt: US$3,582 million ECA Other Banks BRL 9% CLP 7% 3% 6% BNDES 6% 11% Bonds 73% USD 85% Variable Rate 2% Fixed Rate 98% Tissue 8% Pulp 19% Inversi ones CMPC 73% Last financial transactions: Capital increases for US$500 million (June 2013) and US$250 million (July 2014) US$340 million ECA financing 10 year (+2 year grace 3.5% UF 5,000,000 Chilean bond (May 2014) 25 year UF + 3.7% UF 4,000,000 CMPC- B bond prepayment (Sept. 2014) US$500 million international bond (Sept. 2014): 10 year UST bps Amortization schedule (as of today) Bonds Banks / /39 Source: CMPC 17

18 4. COMMITTED TO SUSTAINABLE DEVELOPMENT AND CORPORATE GOVERNANCE

19 CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY Throughout its history, CMPC has maintained a way of doing business and engaging with employees, customers and shareholders. With a 95-year tradition, the following five values summarize our vision of how we should work. Respect for people Fairness when competing Care of the environment Strict compliance with the legal regulation Consideration for neighbors' needs Our objectives for the period: Increase of our renewable energy generation, reducing the purchase of fossil fuels and electricity Increase the energy efficiency of pulp mills by 20% by 2020 Complement the FSC Certification for the stewardship of renewable forest plantations in Chile and Brazil with the respective FSC Chain-of-Custody for the products made by the Company Reduce CMPC s water consumption and effluent volume by upgrading the older industrial processes *For further information please review our CSD Report which is available at 19

20 CORPORATE GOVERNANCE IN CMPC Board of Directors Elected every three years by shareholders Shareholders Meeting to account for the administration Scheduled meetings held once a month to evaluate and decide on the development of the Company Senior Management Appointed by the Board of Directors The controlling group members do not serve as CMPC s managers Eliodoro Matte Chairman 39 Years as Director Bernardo Matte 30 Years as Director Erwin Hahn Independent 4 Years as Director Jorge Gabriel Larraín 35 Years as Director Jorge Marín Independent 19 Years as Director Martín Costabal 10 Years as Director Directors Committee Current members: Jorge Marín, Erwin Hahn and Martin Costabal Is responsible for examining the background information concerning related party transactions examining the reports prepared by the external and internal auditors examining officers compensation systems and plans, among others matters Other Self Imposed Requirements Controllership Department, Internal Control Department, Corporate Governance structured downstream, Corporate Ethic Code, Antitrust Guide, Global Demand Line, Investor Relations Department, Auditing Committee, Risk Committee, among others 20

21 5. INVESTMENT PORTFOLIO IN HIGH GROWTH POTENTIAL BUSINESSES

22 CMPC IS FINISHING THE LARGEST INVESTMENT CYCLE OF ITS HISTORY RECURRENT INVESTMENTS FORESTRY Land purchases for forestry uses and associations with 3 rd parties. PULP Guaíba Expansion 1.3 million ton/year US$ 2.1 billion 2Q15 TISSUE Increase in conversion capacity of tissue paper and sanitary products TISSUE Tissue Machine + Cogeneration Altamira Mill (Mexico) 50 th. tons /year 21MW + 30 tons steam/hour US$ 130 million 3Q15 (80% disbursed*) TISSUE/ENERGY Cogeneration plant Talagante Mill 21MW + 25 tons steam/hour US$33 million 4Q15 (79% disbursed*) PAPERS/ENERGY Cogeneration plant Puente Alto Mill 50MW + 80 tons steam/hour US$71 million 3Q15 (88% disbursed*) *As of September 30 th,

23 GUAÍBA 2 PROJECT 3Q15 FIGURES 160,674 tons Total Sales 264,926 tons Total Production Guaíba 2 Project executed on-time and on-budget thanks to CMPC s expertise in large scale projects and a good relations with its vendors, contractors, unions, workers and the local community. MAIN PROJECT HIGHLIGHTS May 2015 Startup 4Q15 Full ramp up US$2.1 billion Total Investment 1.3 million tons Installed Capacity 30 MW Excess energy 100% Wood self-sufficiency 24 months Construction period No strikes During construction High Security Standards Low loss-time accidents metrics during construction 23

24 TISSUE DIVISION: CMPC IS FAVOURABLY POSITIONED TO CAPTURE THE DEVELOPMENT AND GROWTH OF THESE MARKETS CMPC successfully evolved from a local player into a leading LatAm tissue player due to its ability to enter new markets with high potential based on a pioneering spirit sustained by world-class innovations Mexico 6% Ecuador CMPC: 134 th. tons* 23% Colombia 11% CMPC: 27 th. tons Brazil 7% CMPC: 135 th. tons CMPC Tissue Sales (US$ million) Peru Uruguay CMPC has a strong presence in all main categories of tissue, sanitary and away from home products 296 Entry to Mexico 430 Entry to Ecuador - Colombia 682 Entry to Brazil 1,106 1,503 2,015 1, % CMPC: 71 th. tons Chile 75% Argentina 43% CMPC: 166 th. tons* CMPC: 99 th. tons CMPC Tissue Paper Market Share. 80% CMPC: 35 th. tons Source: CMPC as of December 31 st

25 Tíssue Paper App. Consumption (k/hab.) CMPC SEEKS TO TAP LATAM UNDERPENETRATED TISSUE MARKETS High growth potential due to low per capita consumption relative to developed economies. Latam average tissue consumption: 5.7 kg/person Expected growth in LatAm markets: 64% for Tissue Paper and 34% for Diapers for the period Tissue Paper and Baby Diapers Annual Consumption Growth Latam Brazil Mexico Argentina CAGR * Market Size (2012) (0.1%) 1.9% 3.1% 2.7% 3.7% 4.2% 5.0% 6.3% 3,517 31,745 1,036 11, , ,230 Per Capita Tissue Consumption Canada Sweden UK Finland Austria Belgium Germany Israel New Zealand Iceland Greece Malta Spain Japan Australia Costa Rica Portugal France Chile Hungary Italy Panama Poland Czech Republic Uruguay Mexico El Salvador Brazil Venezuela 5 Guatemala Honduras Ecuador, Peru, China, Colombia, South Africa Indonesia 0 India GNI p/c (thousand US$ at ppp) USA Colombia Chile Peru Ecuador Uruguay Other Latam 1.7% 1.3% 1.9% 2.3% Tissue Paper (th. tons) 5.7% 4.4% 4.2% 6.1% 5.6% 5.2% 4.9% 9.3% Baby Diapers (th. units) 206 2, , ,842 Source: CMPC as of December 2013 Source: RISI Tissue World Report (June 2013) and Price Hanna Report (February 2013) * CAGR: Compound Annual Growth Rate 25

26 AGENDA I. Company description II. Our value proposal 1. Leading diversified Latin American P&P player 2. Low cost producer with world class assets 3. Strong balance sheet and financial track record 4. Committed to Sustainable Development and Corporate Governance 5. Investment portfolio in high growth potential businesses III. IV. Challenges Appendix

27 CMPC WILL BASE ITS STRATEGY IN 4 PILLARS TO CONSOLIDATE ITS LEADERSHIP IN THE P&P INDUSTRY 1. Successfully execute its investment program 2. Focus on cost control and enhance efficiency 3. Maintain a balanced capital structure 4. Consolidate CMPC s culture among all business divisions and countries 27

28 AGENDA I. Company description II. Our value proposal 1. Leading diversified Latin American P&P player 2. Low cost producer with world class assets 3. Strong balance sheet and financial track record 4. Committed to Sustainable Development and Corporate Governance 5. Investment portfolio in high growth potential businesses III. IV. Challenges Appendix

29 APPENDIX I: ANNUAL CAPACITY BY PRODUCT/COUNTRY Business Area Product / Country Capacity Sawn wood 1.0 M m 3 Forestry Remanufactured wood 190 th. m 3 Plywood 500 th. m 3 Pulp Papers Tissue BSKP (Laja) BSKP (Pacífico) BEKP (Guaíba) BEKP (Santa Fe) Boxboard Paper Bags Corrugated Paper Corrugated boxes Molded Pulp trays Other Papers Chile Brazil Argentina Mexico Peru Uruguay Colombia 340 th. tons 500 th. tons th. tons th. tons 431 th. tons 93 th. tons 660 M bags 330 th. tons 285 th. tons 18 th. tons 296 M bags 140 th. tons 166 th. tons 135 th. tons 99 th. tons 134 th. tons 71 th. tons 35 th. tons 27 th. tons 29

30 APPENDIX II: NEW BEKP CAPACITY IN THE 4OO+ MILLION TONNES FIBER MARKET Fiber World Consumption required to produce 403 million tons of Paper&Board Virgin fiber used to produce Paper&Board (million tons) Market Pulp consumed to manufacture Paper&Board (million tons) Recovered Paper 234 million tons (56%) Virgin Pulp 183 million tons (44%) Integrated 124 million tons (68%) Market Pulp 59 million tons (32%) BSKP 24 BHKP 28 Mec 5 UKP 2 Sulphite 417 million tons of total fibers [Containerboard: 146 million tons] [P&W: 109 million tons] [Other P&B: 86 million tons] [Tissue: 32 million tons] [Newsprint: 31 million tons] Source: RISI 5-year Forecast ( ) - December million tons of market pulp 28 million tons of BHKP [BEKP: 16.8 million tons] [Guaíba II: 1.3 million tons] 30

31 Million Tons APPENDIX II: EUCALYPTUS PULP GROWTH HAS OUTPACED OTHER HARDWOOD FIBERS BECAUSE OF ITS COST AND QUALITY ADVANTAGES Higher pulp production yield than other species Fast growing trees: shorter rotation, less land required and better performance Superior structural properties for several paper & paperboard applications Paper manufacturers looking for BEKP to premium tissue products BEKP replacing other fibers 35 BHKP Birch BEKP ABHKP NMHKP SMHKP CAGR: 30 BHKP: +4.4% BEKP: +7.7% Source: HW Outlook for Market Pulp April 2015 ABHKP: +9.5% NMHKP: -1.7% SMHKP: -5.5% Birch: -3.4% 31

32 Million Tons APPENDIX II: THE PAPER INDUSTRY HAS GROWN, SPECIALLY IN THE PACKAGING SEGMENT Since 1992 paper production has grown 61%, mainly explained by: 106 million additional tons of packaging paper 33 million additional tons of P&W papers 18 million additional tons of tissue papers 450 Newsprint P&W Packaging Tissue Other P&B Source: RISI Since 2007, Packaging and Tissue have continued to grow, while P&W has declined 32

33 Disclaimer: This document provides information about Empresas CMPC SA. In any case this constitutes a comprehensive analysis of the financial, production and sales situation of the company, so to evaluate whether to purchase or sell securities of the company, the investor must conduct its own independent analysis. In compliance with the applicable rules, Empresas CMPC SA. publishes this document in its web site ( and sends to the Superintendencia de Valores y Seguros, the financial statements of the company and its corresponding notes, which are available for consultation and review. CONTACT INVESTOR RELATIONS Colomba Henríquez colomba.henriquez@cmpc.cl +(562) Isidora Farías isidora.farías@cmpc.cl +(562)