EMPRESAS CMPC FOURTH QUARTER 2014 RESULTS

Transcription

1 EMPRESAS CMPC FOURTH QUARTER 2014 RESULTS March 6 th, 2014

2 FORWARD-LOOKING STATEMENTS This presentation may contain forward-looking statements. Such statements are subject to risks and uncertainties that could cause CMPC s actual results to differ materially from those set forth in the forward-looking statements. These risks include: market, financial and operational risks. All of them are described in CMPC s Financial Statements, Note 3 ( Gestión de Riesgos ). In compliance with the applicable rules, Empresas CMPC S.A. publishes its financial results on 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 on its website (

3 4Q14 FINANCIAL AND OPERATIONAL HIGHLIGHTS In U S$ Milllion 4Q14 3Q14 4Q13 QoQ YoY Revenues 1,199 1,237 1,259-3% -5% COGS (788) (813) (826) -3% -5% Other Operational Expenses (172) (172) (179) 0% -4% EBITDA % -6% EBITDA margin % 20% 20% 20% 0% -1% Operational Result % -15% Non Operational Result (82) (175) (104) -53% -21% Net Income 38 (39) % 2% Volumes 4Q14 3Q14 4Q13 QoQ YoY Forestry + Solid Wood Prod. (1) 1, ,035 11% 2% Market Pulp (2) % -8% Papers (2) % -1% Tissue Papers (2) % 4% (1) Th. m 3 (2) Th. tons Revenue decrease: 3% QoQ decrease driven mostly by lower pulp volumes as Company increases inventory to normalize levels. 5% decrease YoY EBITDA of US$239 million, down 5% and 6% when compared to 3Q14 and 4Q13 respectively Net Income of US$38 million, compared with a loss of US$39 million in 3Q14 and income of US$37 million in 4Q13 Operational & Other Highlights Pulp inventories now at reasonable levels ahead of Guaíba I maintenance in March and the start up of the expansion Project Plywood project reached its design capacity Liability management operations Lower CAPEX expenditures after Guaíba disbursements peaked in 3Q 3

4 2014: LARGE SCALE INVESTMENTS, OPERATIONAL EFFICIENCIES Operational and Financial Highlights Lower costs drive modest EBITDA growth EBITDA margin of 20.3% from 19.4% in 2013 Positive effect of US Dollar appreciation in operations US$60 million negative impact in results due to the end of energy contracts 2 nd part of capital increase and liability management actions Net income excluding the impact of currency movements on deferred taxes was US$327 million, compared with US$298 million in In U S$ Milllion YoY% Revenues 4,846 4,974-3% COGS (3,187) (3,312) -4% Other Operational Expenses (674) (699) -4% EBITDA % EBITDA margin % 20% 19% 1% Operational Result % Non Operational Result (395) (339) 16% Net Income % Growth across businesses Full year pulp volumes up 3%, despite build up of inventories in fourth quarter Steady growth in Tissue: 4% increase in tissue volumes, double digit growth in sanitary products Advance in the Plywood Project learning curve (32% higher volumes compared to 2013) Progress with Investment Projects 2014 s CAPEX: ~US$1.6 billion Guaíba Project: on schedule, on budget Altamira Tissue Machine ~50% complete Cogeneration plants ~60% complete Recognitions and certifications Confort brand award La Segunda Prohumana ISO Certification 4

5 COSTS AND OTHER OPERATIONAL EXPENSES ANALYSIS COGS (US$ Million) % 788-5% COGS decreased 3% and 5% compared to 3Q14 and 4Q13 respectively due to: Lower sales Positive effect of local currencies depreciation Lower harvesting and transportation costs in the Forestry division Higher efficiencies in plywood due significant advances in the learning curve 2014 COGS decreased 4% compared to 2013 due to lower sales, higher operational efficiencies and the positive effect of the US Dollar appreciation COGS in 4Q14 were 66% of total revenues, stable QoQ and YoY Other Operational Expenses were stable compared to 3Q14 and decreased 4% compared to 4Q13 Positive effect of local currencies depreciation Higher distribution costs in the Paper division 2014 s Other Operational Expenses decreased 4% compared to those of 2013, mainly due to lower Administration and Distribution Expenses Other operating expenses in 4Q14 were 14% of revenues, stable when compared QoQ and YoY Other Op. Exp. (US$ Million) % -4%

6 FORESTRY 147 Sales * Revenues: -5% QoQ / +2% YoY EBITDA * * Figures in US$ million Volumes (Th. m 3 ) Pulpwood Sawing Logs Sawn wood Remanufactured wood Plywood Others Total 1, ,052 Volumes: +11% QoQ: - +96% QoQ of pulpwood: higher wood chip exports - +17% QoQ of plywood: higher production because the expansion project reached its design capacity. Higher sales in Chile - +7% QoQ of sawnwood: seasonality 4Q in Chile -5%YoY: - -22% of pulpwood volumes due to lower sales in our Argentinean operations -5% reduction in sawn wood volumes due to lower exports to Latam and Middle East, partly offset by a +54% increase in plywood volumes due to the advance in the learning curve of the project Prices: -15% QoQ higher proportion of wood chips sales led to lower forestry mix price EBITDA: +26% QoQ, +24% YoY: - Advance of the plywood project increase efficiency and economies of scale (in 4Q13 there were one-time set up costs) - Lower harvesting and transportation costs due to the reduction in oil prices 6

7 PULP Sales * EBITDA * Revenues: -6% QoQ / -14% YoY Volumes: -7% QoQ - BSKP stable QoQ - BEKP -9% QoQ normalization of inventories from low levels at end of 3Q14 (28 days) - Scheduled maintenance periods undertaken at the Laja and Santa Fe I mills: downtime of 15 and 12 days respectively Prices (including a small tonnage of P&W papers and energy sold to the SIC grid): +1% QoQ, -6% YoY Average effective net export price was CIF 709 US$/ton for softwood and CIF 582 US$/ton for hardwood * Figures in US$ million Volumes (t h. Tons) BSKP BEKP Other Total Market Pulp EBITDA: -19% QoQ - Lower sale volumes (lower fixed cost dilution) - 2 maintenance downtimes in the quarter - Expansion at Guaíba affected production at existing pulp line - Lower EBITDA contribution of the Energy business -20% YoY 7

8 PAPERS 256 Sales * Revenues: +8% QoQ / -1% YoY EBITDA * Volumes: +9% QoQ - +45% of corrugated boxes and +31% in corrugated papers due to the summer fruit export season in Chile - +2% of paper bags led by the Peruvian market - -3% of boxboard - -17% of molded pulp trays due to a lower apple season in terms of volumes Stable volumes YoY: higher packaging volumes in 4Q14 offset the newsprint mill closure at the end of 2013 * Figures in US$ million Prices: -1% QoQ and -2% YoY, due to lower prices of boxboard, corrugated paper and paper bags Volumes ( th. Tons) Boxboard Newsprint Paper Bags Other Papers CMPC Packaging Corrugated Paper Corrugated Boxes Molded Pulp Trays Total EBITDA: +27% QoQ - Higher sales and efficiency - Lower electricity costs -11% YoY, mainly due to the end of electric energy contracts as of the end of 2013 The Maule Mill recorded a new annual production record of 362 th. tons of folding boxboard 8

9 TISSUE Sales* Revenues: -6% QoQ / -1% YoY EBITDA * Volumes: Tissue Paper -3% QoQ due to seasonality effects in Argentina, Chile and Ecuador Sanitary Products -3% QoQ due to lower sale volumes in the Northern countries (Mexico, Colombia and Brazil) and Chile Prices (measured in US$) -3% QoQ for tissue paper and stable QoQ for sanitary products, both were affected by the US Dollar appreciation * Figures in US$ million 15% Tissue Paper Sales Volumes by Country 13% 4% 3% 2% 151 th. Tons 17% 24% 22% Chile Brazil Argentina Mexico Peru Uruguay Colombia Ecuador EBITDA: -12% QoQ - Lower volumes - Lower prices - Year end seasonal expenses +6% YoY mainly explained by lower direct costs 9

10 DEBT ANALYSIS Cash of US$1,097 million in 4Q14, down 32% from 3Q14 and up 7% from 4Q13 Main sources of liquidity: BNDES: US$135 million + ECAs: US$35 million Main uses of liquidity: US$400 million prepayment of 2011 s syndicated loan + US$394 million in CAPEX + US$16 million in dividends Financial Ratios Net Debt/EBITDA ratio of 3.4x, up from 3.1x in 3Q14 and 2.8x in 4Q13 Financial Debt/Net Tangible Worth ratio of 0.56x, down from 0.58x in 3Q14 and up from 0.46x in 4Q13 Interest Coverage ratio of 5.33x, down from 5.54x in 3Q14 and 5.67x in 4Q13 Regarding leverage, disbursements for the Guaíba Project peaked in 3Q14; steadily lower disbursements going forward Debt by Issuer Debt by Currency Debt by Interest Rate Debt by Type 19% 7% 4% 10% 4% 14% 9% 5% 8% 73% 79% 96% 72% Inversiones CMPC Tissue Pulp USD CLP BRL Other Fixed Rate Floating Rate Banks Bonds BNDES ECA 10

11 2014: RESILIENT PULP PRICES COMPARED WITH OTHER COMMODITIES Brent Copper WTI Gold Iron Ore Silver Soy Gas Steel BSKP BHKP BSKP: +3% Gold: -2% BHKP: -3% Steel: -10% Silver: -16% Copper: -17% Soy: -22% Iron Ore: -42% Gas: -46% Brent: -48% WTI: -51% Source: Bloomberg 11

12 MARKET PULP COMMENT Market Pulp demand (2014 vs. 2013) % % +5.3% % +0.4% +0.2% % Global demand for pulp increased 1.5% in 2014 compared to Global demand for pulp increased 1.7% in 4Q14 from 3Q14 and 1.9% compared to 4Q13. If we compare 4Q14 with 3Q14: Chinese demand grew 4.49% (200 Th. tons) North American demand grew 3.5% (69 Th. tons) LatAm demand increased 5.2% (45 Th. tons) European and Oceanian demand remained stable Other Asia demand fell 2.5% (65 Th. tons) ,000 North America Western Europe Eastern Europe Latin America Japan China Other Asia BHKP market currently balanced compared to BSKP market, due to Russian discounts in China +8.7% 1,500 1,000 Pulp inventory days % +3.5% % Northern Softwood Southern Softwood Radiata Softwood -5.2% Northern Hardwood -25% Southern Eucalyptus Hardwood Source: PPPC, World Chemical Market Pulp Global 100 Report Dec Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 Source: PPPC 12

13 STRATEGIC FOCUS FOR 2015 Enhance our position as a large scale Company with efficient Latin American production for global and local markets Proceed with final 10% of civil work at 1.3 million ton Guaíba expansion ahead of 2Q15 startup Realize benefits of investments in efficiency and low-cost production Map out plans for growth post Guaíba expansion Manage leverage and liabilities Consolidate CMPC s Culture among all business divisions and countries 13

14 Q&A