17ª Conferência Anual Santander August, 2016

Transcription

1 17ª Conferência Anual Santander August, 2016

2 2 Disclaimer The information contained in this presentation may include statements which constitute 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.

3 Company Overview Pulp and Paper Market Financial and Operational Highlights Expansion Project Horizonte 2 Dividends Cost reduction initiatives and industry statistics Agenda 3

4 Company Overview 4

5 Shareholder Structure and Corporate Governance Votorantim S.A. (1) 29.42% BNDES Participações (1) 29.08% Free Float (2) 41.50% Fiscal Council General Meeting Board of Directors 20% independent members Role of CEO and chairman is split Finance Committee Statutory Audit Committee Personnel and Remuneratio n Committee Sustainability Committee Innovation Committee 30% independent members 100% independent members 50% independent members 45% independent members - 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 Listed on Novo Mercado, highest level at BM&FBovespa: Financial Statements in International Standards IFRS Adoption of Arbitration Chamber SEC Registered ADR Level III program Policies approved by the Board of Directors: Indebtedness and Liquidity Market Risk Management Risk Management Corporate Governance Related Parties Transactions Anti-Corruption Information Disclosure Securities Trading Antitrust Genetically Modified Eucalyptus Dividend Policy Sustainability NEW (1) Controlling group (2) Free Float 41.44% + Treasury 0.06% 5

6 A Winning Player Superior Asset Combination Main Figures 2Q16 LTM Pulp capacity million tons Net revenues US$ billion Total Forest Base (1) thousand hectares 969 Belmonte Veracel Caravelas Portocel Aracruz Planted area (1) thousand hectares 568 Net Debt US$ billion Net Debt/EBITDA (in Dollars) (2) X 2.10 Três Lagoas Jacareí Santos Port Terminal Pulp Unit 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; As of December 31, (2) For covenants purposes, the Net Debt/EBITDA ratio is calculated in Dollars. 6

7 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 7

8 8 Fibria s Commercial Strategy Sales Mix by End Use - Fibria Highlights Region - 2Q16 Europe 36% N. America 21% LatAm 10% Asia 33% Net Revenues by Region - Fibria End Use - 2Q16 Tissue Printing & Writing 49% 29% Specialties 22% 10% 9% 10% 8% 9% 8% 10% 9% 10% 10% 10% 9% 8% 9% 12% 10% 22% 25% 26% 21% 25% 26% 26% 27% 24% 23% 26% 26% 25% 20% 25% 33% 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 26% 30% 22% 29% 31% 31% 19% 23% 27% 27% 17% 24% 25% 29% 17% 21% 100% certified pulp (FSC and PEFC/Cerflor) 42% 37% 43% 43% 35% 36% 46% 42% 39% 40% 47% 42% 42% 42% 46% 36% 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 Europe North America Asia LatAm

9 Leadership Position Industry Outlook (1) Fiber Consumption 412 million t Recycled Fiber 242 million t 59% 41% Pulp 169 million t 18% 82% Mechanical 30 million t Chemical 140 million t 59% Integrated Mills 83 million t 41% Market Pulp 57 million t 46% 54% Softwood/Other 26 million t Hardwood 31 million t 30% 70% Acacia/Other 9 million t Eucalyptus 21 million t 75% Other Eucalyptus Pulp producers: 16 million t 25% (1) Fiber Consumption, Recycled Fiber and Pulp: RISI Market Pulp, Hardwood and Eucalyptus: PPPC Global 100 Report December

10 10 Pulp Supply Agreement: Puma Project Puma Project Pulp volumes: Minimum of 900 kt of hardwood for the first 4 years 75% of 900 kt for the fifth year (phase out 1) 50% of 900 kt for the sixth year (phase out 2) Selling price based on the average net price charged by Fibria at the Port of Paranaguá (FOB Paranaguá) Sales destination: Globally, except for South America Operational startup: Mar/2016 Agreement benefits: Logistics and commercial structure synergies; Ensure sales volumes; Ensure pulp market access with Klabin brand. Logistics and commercial optimization and synergies; Support customers growth and enhance customers needs; Potential development of new customers. Mutual value creation, with better servicing for both Companies customer s base

11 Pulp and Paper Market 11

12 The better than expected scenario has become a reality again in BHKP CAPACITY CHANGES EXPECTED SCENARIO FOR 2015 IN DEC 14 REALIZED SCENARIO IN 2015 Suzano Maranhão Montes del Plata Suzano Maranhão Montes del Plata Oji Nantong CMPC Guaiba II Eldorado Portucel Cacia Old Town (Expera) Sappi Cloquet April Rizhao Ence Huelva Possible closures* Net to ,415 to 1,815 Oji Nantong CMPC Guaiba II Eldorado Portucel Cacia Old Town (Expera) Ence Navia Sappi Cloquet April Rizhao Ence Huelva Unexpected Downtimes Net Indonesia, China, Uruguay and Brazil 1,450 BEKP demand growth** 1,095 BEKP demand growth** 1,232 *Based on annual closures average (400,000 to 800,000 t/yr) **Source: PPPC Outlook for Eucalyptus Market Pulp December 2014 **Source: PPPC Market Pulp World 20

13 13 and so has been the price scenario BHKP Delivered to Europe (USD/t) Q15 2Q15 3Q15 4Q15 Annual 2015 Consultants average at the end previous year Realized PIX/FOEX price Consultants: Hawkins Wright, RISI and Brian McClay (published in the end 2014 for 2015 prices)

14 Better worldwide macroeconomics are the key drivers But the special focus is on Europe 14 Real GDP % Annual Growth ,3 World Euro Area USA China Source: International Monetary Fund, World Economic Outlook Database, January 2016

15 15 But the special focus is on Europe Hardwood and Eucalyptus Shipments (000 t and % annual growth) % 3.8% 5.0% 3.3% % -0.8% -0.8% -0.6% BHKP BEKP Source: PPPC World 20

16 16 So, what can we expect for 2016? BHKP CAPACITY CHANGES EXPECTED SCENARIO FOR 2016 IN NOV 15 FIBRIA S EXPECTED SCENARIO FOR 2016 CMPC Guaiba II 800 CMPC Guaiba II 800 Klabin 660 Klabin 660 Altri Celbi Old Town (Expera) Woodland Verso Wickliffe APRIL Kerinci Altri Celbi APP South Sumatra Old Town (Expera) Woodland Verso Wickliffe APRIL Kerinci Possible closures* -400 to -800 Possible closures* -200 Net 385 to 785 Net 1,165 BEKP demand growth** 930 1,200 BEKP demand growth** 1,200 *Based on annual closures average (400,000 to 800,000 t/yr) **Source: PPPC Outlook for Eucalyptus Market Pulp May 2015 (930kt) and Fibria s estimates Positive Supply/Demand Balance!

17 Global Market BEKP Demand Shipments of Eucalyptus Pulp 3% 128kt Total 7% 216kt 8% 40kt 26% 64kt North America (1) Source: PPPC Global 100 February/2016 2M16 vs. 2M15 (1) 6% 84kt 6% 114kt Western Europe BHKP 10% BEKP -1% 1% 1% 4% -7kt 12kt 11kt 26kt China Others 4% 586 kt 8% 835 kt (1) Source: PPPC Global June/2016 6M16 vs. 6MQ15 (1) -6% 1% -1% 0% -103kt 7kt -63kt -5kt Total North America Western Europe BHKP BEKP 15% 24% 688 kt China 758 kt 1% 3% 64kt 75kt Others Paper Capacity increase in China FORECAST REALIZED PREVIOUS FORECAST LATEST FORECAST LATEST FORECAST Woodfree ,000 Tissue 1,390 1,278 1, Cartonboard 2,100 1, Total 3,746 2,860 2,855 2,845 2,198 Source: Fibria and Independent Consultants 17

18 Technical Age and Scale in the Pulp Industry Further closures are expected due to lack of adequate investments in the industry 18 Hardwood (BHKP) Producers Integrated and Market Pulp Mills Softwood (BSKP) Producers Integrated and Market Pulp Mills 2000 PM Capacity, 1000 t/a Aracruz Weighted average technical age 12.3 years STRONG PM Capacity, 1000 t/a Weighted average technical age 21 years STRONG Veracel Weighted average capacity 1,350,000 t/a Jacareí Três Lagoas Weighted average capacity 534,000 t/a 0 30 WEAK Technical age, years WEAK Technical age, years 5 0 North American Pulp Mills Other Pulp Mills More than 6.6 million tons of capacity above 25 years and with annual capacity below 500,000 t/y.

19 Capacity closures DO happen Closures of Hardwood Market Pulp Capacity Worldwide (000 ton) ,260-1,180-1, E (1) Source: PPPC and Fibria (1) As of January : -40kt Old Town (USA), -90kt Woodland (USA), -55kt Verso Wickliffe (USA), -120 April Kerinci (Indonesia) 2017: -275kt Arauco Valdivia (Chile) 19

20 Even more competitive cash production cost w/ H2 BHKP (US$/t) BHKP capacity (000 t) 1,130 1,105 2,075 2,290 4,915 3,420 15,275 Total: 30,210 BHKP (US$/t) WK Interest Capex Income tax SG&A USA Canada China Iberia Chile/Uruguay Indonesia Brazil Fibria 2Q16 LTM Estimated Fibria w/ H Cash Cost (US$/t) Delivery CIF Europe Source: Hawkins Wright (Price Forecast June 2016) and Fibria s 2Q16 Earnings Release -FX considered by the consultant at R$/US$ = H2 cash cost was estimated according to weighted average cost, after mill balance, converted at R$/US$=3.21. Includes energy sales. 20

21 Gross capacity addition should not be counted as the only factor influencing pulp price volatility. (1) BHKP prices - CIF Europe (US$/ton) Capacity (000 ton) ,0 900 Eldorado Horizonte II 1,8 800 Rizhao Maranhão APP South Sumatra (2) 1, APP Hainan Fray Bentos Mucuri Veracel Nueva Aldea Três Lagoas Montes del Plata Guaíba II Klabin 1,4 1,2 1, Valdivia Santa Fé Kerinci PL3 APP Guangxi Chenming Zhanjiang Oji Nantong 0,8 0, , , ,0 (1) Source: Hawkins Wright, Poyry and Fibria Analysis. Pulp price estimates according to Hawkins Wright (Dec/15), Brian McClay (Feb/16) and RISI (Feb/16) (2) Partially integrated production.

22 Dec-99 Jun-00 Jan-01 Jul-01 Jan-02 Aug-02 Feb-03 Sep-03 Mar-04 Sep-04 Apr-05 Oct-05 Apr-06 Nov-06 May-07 Dec-07 Jun-08 Dec-08 Jul-09 Jan-10 Jul-10 Feb-11 Aug-11 Mar-12 Sep-12 Mar-13 Oct-13 Apr-14 Oct-14 May-15 Nov-15 Jun-16 In the last 15 years, pulp volatility has been just 8%...why? 160 BHKP - FOEX Europe (base 100) CPI (base 100) Market price closer to producer s marginal cost The marginal cost producers are based in Europe and North America Flattish industry cost curve Higher flexibility to adjust supply side during imbalanced market Lower dependency on Asian market (~25%) compared to hard commodities (70%+) Market end users are linked to consumer goods, such as tissue Incipient pulp price futures market and low liquidity Source: Bloomberg August 16 th, 2016

23 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Lowest volatility among commodities = January 1, Iron Ore Soy Bean Crude Oil Sugar BHKP - FOEX Europe Exchange Rate (R$/US$) Low volatility of hardwood pulp price, even though new capacities have come on stream during the period. Source: Bloomberg August 16 th,

24 The only commodity with lower volatility than FX Historical Volatility of Commodities (US$) 37% 35% 34% 27% 27% 26% 25% 23% 16% 14% 6% WTI Crude Oil Sugar Nickel Iron Ore Copper Soy Ibovespa LME Metals Cattle FX BHKP Since January 1, 2009 up to August 16 st,

25 Financial and Operational Highlights 25

26 Each 5% depreciation of the Real increases EBITDA by around R$420m and FCF by R$550m Exchange Rate Average (R$/US$) (1) Fibria net pulp price (US$/t) (2) Fibria net pulp price (R$/t) 912 1,179 1,067 1,133 1,311 1,344 1,951 2,135 1,768 53% 52% EBITDA Margin 29% 40% 1,488 34% 36% 1,173 1,153 40% 39% 1,295 1,185 1,560 1, EBITDA (US$ million) Q16 LTM 2016 (e) (1) According to Focus Report (Brazilian Central Bank August 5, 2016) I (2) 2016 market consensus 26

27 Cash Production Cost (R$/t) 2Q % Q15 1Q16 2Q16 May-June/16 Resumption of operational performance Non-recurring pressure of third party wood Cash Production Cost (R$/t) 2Q16 LTM Q15 FX Utilities Maintenance Wood Specific Others 2Q16 US$ 190/t Results Downtime Consumption US$ 189/t Cash-cost reduction opportunities related to non-recurring effects of: Energy prices Third party wood Operational performance 27

28 Cash Production Cost in dollars saw a decrease over the past 7 years Fibria Cash Production Cost (1) (US$/ton) Consistently controlling the cash production cost 2009 (2) 2010 (2) Q16 LTM (1) Constant Currency. (2) Excludes Conpacel 28

29 29 Net Results (US$ million) 2Q16 (29) 123 (135) deferred current (188) (98) 212 Adjusted EBITDA FX Debt MtM hedge Net Interest Deprec., amortiz. and depletion Taxes (1) Others Net Income Non-recurring effects (1) Includes other Exchange rate/monetary variations, other financial income/expenses and other operating income/expenses.

30 30 Free Cash Flow 2Q16 (US$ million) 264 ( 131 ) ( 5 ) 118 ( 45 ) 36 Adjusted EBITDA Capex (ex-h2 project) Net Interest (2) Working Capital Taxes FCF (1) Not considering dividend payment and capex related to the Horizonte 2 project. (2) Impacted by semi-annual interest payments on the bonds and funding related to the Horizonte 2 project.

31 31 ROE and ROIC (R$) ROE = Adjusted EBIT (1) / Equity before IAS 41 (2) ROIC = Adjusted EBIT (3) / Invested Capital before IAS 41 (2) 25.1% 21.9% 22.8% 21.3% 3.4% 5.7% 6.2% 6.9% 9.2% 8.0% Average FX (R$/US$) Average Net Price (US$) Q16 UDM Average FX (R$/US$) Average Net Price (US$) T16 UDM (1) Adjusted EBITDA CAPEX Net Interest Taxes (2) International accounting standards for biological assets. (3) Adjusted EBITDA CAPEX Taxes

32 Indebtdeness Gross Debt and Cash Position (R$ million) Net Debt (Million) and Leverage 9,015 11,498 + R$1.2 bn 12,705 Net Debt/EBITDA (R$) Net Debt/EBITDA (US$) ,189 2,983 Jun/15 Mar/16 Jun/16 8,197 10,309 9,722 2,642 2,897 3,029 Gross debt Cash + R$1.8 bn Jun/15 Mar/16 Jun/16 R$ US$ Interest Expense/Income (US$ million) and Cost of Debt in US$ (1) Q16 LTM 4.6 Cost Averageof cost debt in US$ (% p.a.) Interest Expense (Gross) (1) Considering the portion 3.4 of debt in 3.3 reais (1) fully adjusted by the market swap curves at the end of each period. Interest on Financial Investments 32

33 Liquidity Revolver Cash on hand (1) Liquidity (1) and Debt Amortization Schedule (US$ million) 1,477 Export Prepayment BNDES ECN ACC/ACE 545 Voto IV Bonds 840 Finnvera ARC and Others Liquidity Capex H2 (2) : (1) Not including US$9 million related to MtM of hedging transactions. (2) Financial execution of US$608 million capex until June 30th, Considering FX R$/US$ = Horizonte 2 Funding (US$ billion) 0.3-2S S S ,2-2S16 0, Q QT Export Prepayment ARC BNDES FDCO ECA Working capital release (2) (2) Related to contract with Klabin and suppliers. Funds withdrawn until June 30th, Contracted funds to be withdraw. Total 33

34 Capital Structure: Fibria has achieved the lowest leverage ratio among its Latin American peers Net Debt/EBITDA (x) (1) 8, Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 Fibria Suzano Klabin CMPC Arauco Eldorado Fibria Arauco CMPC Klabin Suzano S&P BBB-/Stable BBB-/Stable BBB-/Stable BB+/Estable BB+/Stable Moody s Ba1/Negative Baa3/Stable Baa3/Stable - Ba2/Stable Fitch BBB-/Stable BBB/Stable BBB+/Stable BBB-/Negative BB+/Positive (1) Fibria s historical data in BRL. 34

35 (1) G-spread on August 11 st, One of the best performances among Brazilian corporate issuers (1) Historical G-spread (bps) Rating Outlook BBB- Stable BBB- Stable Fibria 2020 Fibria 2021 Fibria BRAZIL BRFOODS GLOPAR FIBRIA SUZANO EMBRAER VALE BRASKEM KLABIN GERDAU PETROBRAS ELDORADO

36 CAPEX

37 2016 Capex Reduction 2016 Total Capex (R$ billion) 8.2 R$1.5 billion reduction Pulp 0.7 Logistics 6,7 (0.5) 0.2 Horizonte (1.0) 4.4 Maintenance and others Reported on Jan. 31, 2016 Current 78% of capex reduction on pulp logistics projects 18% of capex reduction on Horizonte 2 project 37

38 38 Capex Timetable New capex timetable (R$ billion) Pulp logistics Horizonte 2 Project Actual onwards Total Previous % - 100% % Current % - 22% 61% 17% 100% Previous % 2% 62% 33% 3% 100% Current % 3% 56% 38% 4% 100% Previous Total % 2% 64% 31% 3% 100% Current % 2% 53% 40% 5% 100%

39 39 Fibria is able to create value for its shareholders with capital discipline FREE CASH FLOW BIO-ENERGY AND INDUSTRY CONSOLIDATION? PULP Growth with discipline Best portfolio of projects DIVIDENDS OTHER OPPORTUNITIES Complementary to pulp Portocel Land and forest WITHOUT JEOPARDIZING CREDIT METRICS

40 BACK UP 40

41 Expansion Project Horizonte 2 41

42 42 What is the importance of growth for Fibria? Wider fixed costs dilution Competitiveness Cost curve position improvement Greater bargaining power with suppliers Follow the growth of strategic customers Commercial positioning Developing new customers Distribution to new geographic markets Efficiency and competitiveness gains in logistics Higher quality in customer service Long-term growth potential Greater ability to capture new expansion market windows Strong M&A position

43 43 Why expand Três Lagoas? ESTIMATED BHKP CAPACITY RANKING 2017 (000T) Brownfield Project, synergies with current operations Modern plant, prepared for potential expansion Availability of wood and low average distance from forest to mill Forest based on the optionality concept and prioritizing lease and partnership models Additional energy surplus of 130 MWh Start-up: 4Q2017 Capacity: 1.95 million tons Fibria 8,150 CMPC RGE/APRIL Suzano APP Eldorado UPM Stora Enso Arauco Cenibra ENCE Altri IP Marubeni Mitsubishi Oji Mondi Nippon Paper Verso Resolute Georgia-Pacific Portucel Soporcel Lwart Pulp Mill Holding Domtar Klabin Others Current Capacity New Capacity New Capacity Klabin Agreement New Capacity Horizonte II Project Source: Poyry and Fibria Analysis (as of May 2015)

44 44 Pulp sales destination: Fibria growing where the market grows 37% 43% 19% 24% 36% 24% 8% 9% Total sales volume distribution after H2 start up (2) Current net revenue distribution (1) (1) Considers 1Q16 last twelve months. (2) Includes Klabin s sales volume

45 45 Fibria s production volumes Current Production ('000 t) Klabin's Puma Project('000 t)(1) Horizonte 2 ('000 t)(1) 7,940 8,050 8,150 8,150 8, ,740 1,850 1,950 1,950 1,950 5,188 5,231 5,184 5,299 5,259 5,274 5, ,300 5,300 5,300 5,300 5, (1) The volumes in 2016, 2017 and 2018 will depend on the learning curve of the plants. The agreement with Klabin may be renewed by mutual consent.

46 Horizonte 2 project site overview Production capacity increase to 1.95 million t/year Startup in the beginning of 4Q 2017 Ahead of schedule and below budget 45% physically complete Startup Capex (R$ billion) Acc. execution up to 6M16 To be executed until 2018 Total 25% financial execution

47 47 Forestry Base Forestry base required: H1: 120,000 ha H2: 187,000 ha Total: 307,000 ha Average distance from forest to mill H1 + H2 -> up to 100 km (1st cycle) 2nd cycle average distance should decrease due to less need for 3rd party wood

48 48 Logistics Mato Grosso Mato Grosso do Sul Goiás Brasilia Port Terminal 32

49 Capex Update for the current FX level CAPEX (US$ billion) (1) 2% 26% % 19% 72% % Original Revised BRL EUR USD and others There are opportunities for capex postponement, WITHOUT delay in the project startup Physical progress (2) = 45% Disbursed capex (2) = 25% (1) FX: R$ 3.65/US$ (2) As ofjune 30th,

50 Capex Flexibility in the Timetable, without changing the startup date 50 Total Capex (R$ billion) - R$800 million 8.7 Capex Timetable (R$ billion) % % 3.0 3% 0.2 4% 0.3 Previous Forecast Current Forecast US$ 2.4 bn (1) US$ 2.4 bn (1) US$0.1 bn US$1.3 bn US$0.9 bn US$0.1 bn (1) FX = 3,.65 R$/US$ on previous forecast. FX = 3.30 R$/US$ on current forecast.

51 Funding Cost and maturity 2Q16 H2 2Q16 + H2 Average Cost (US$ p.a) (1) 3.4% 2.1% 3.0% Average Maturity (years) Amortization Schedule (2) 2Q16 Proforma with TLS II US$ million BNDES Bond PPE NCE ACC/ACE CRA Finnvera Outros FDCO Total (1) Considering swap curves. (2) FX considering new funding for the TLS II Project:

52 Funding Sources US$ million 0.3-2S S S ,2-2S16 0, QT15 3Q Export Prepayment ARC BNDES FDCO ECA Working capital release (1) Total Funds withdrawn until June 30th, Contracted funds to be withdraw. 100% of funding with signed contracts. BNDES, FDCO and ECA (Finnvera) withdrawal according to capex execution (1) Working capital to be released in 2016 and 2017 by the commercial agreement with Klabin. Main impacts over accounts payable and receivables. 52

53 Investment Grade reaffirmed with stable outlook, despite the sovereign downgrade 53 April, 2016 Its robust performance should provide enough resources to fund the equity portion of its new pulp mill, Horizonte 2, and would help it to reduce leverage towards the end of 2017, when the new mill starts operations. We expect leverage metrics to remain slightly under pressure this year due to the debt load from the investment. But these metrics should gradually decline in 2017 and Feb, 2016 Leverage to Temporarily Increase: Fitch projects net leverage to remain below 2.5x during the construction of the Três Lagoas mill, quickly declining to below 1.5x by the end of (1) According to rating agency methodology

54 Horizonte 2 project assumptions UNIT R$ US$ Pulp production/year k tons 1,950 1,950 Expansion capex (1) $ billion Expansion capex (1) $/t 4,052 1,228 Sustaining capex (2) $/t Cash production cost (3) $/t Energy surplus MWh Project approval FX R$/US$ All in cash cost (estimated range) (4) $/t Net pulp price (5) $/t Free Cash Flow (estimated) $/t Payback period (estimated) years (1) Includes chemical leasing and investments in order to increase capacity to 1,950 kt/year (FX@3.30). (2) Estimated sustaining capex in perpetuity 3.30). (3) Estimated weighted average cost, after mill balance. Includes energy sales (4) Cash cost + freight + SG&A + Sustaining Capex + Interest + taxes 3.30) (5) 2016 market consensus. 54

55 55 Final Remarks Economies of scale Synergies with current operations Wood availability and low distance from forest to mill Fibria s total energy surplus to be increased by 130 MWh Cash cost competitiveness Meet customers demand growth Attractive returns even in adverse scenarios of pulp price and BRL Solid financial profile

56 Dividends 56

57 57 Policies approved by the Board of Directors Indebtedness and Liquidity Market Risk Management Risk Management Corporate Governance Related Parties Transactions Anti-Corruption Information Disclosure Securities Trading Antitrust Genetically Modified Eucalyptus Dividend Policy Sustainability

58 58 Approval of Dividend Policy Commitment to Corporate Governance best practices. Proposed dividends based on cash generation, taking into consideration the company s strategic planning and in line with its policies, notably the Indebtness and Risk Management policies. Preserving Investment Grade. Extraordinary dividend if Policy criteria are met.

59 (1) Considering March 7, 2016 FX R$/US$ Dividends 2015 April 28, 2015 May 14, 2015 Oct. 22, 2015 Nov. 30, 2015 Dec. 9, 2015 Dec. 17, 2015 OGM: Dividend distribution approval: minimum compulsory + additional Dividend Payment of US$49 million Dividend Policy Approval EGM: Interim Dividend Payment Approval Dividend yield as of Dec, 31, 2015 = 7.5% (R$) 8.3% (US$) Dividend yield as of Dec, 31, 2014 = 11.6% (R$) 8.7% (US$) Dividend Payment of US$532 million Dividend distribution proposal of US$78 million (2) approved by the Board of Directors 2016 April 27, 2016 Mid-May, 2016 Mid-November, 2016 Mid-December, 2016 OGM approved dividend distribution of US$80 million (1) (1.1% of dividend yield as of Dec, 31, 2015). Dividend payment of US$80 million. Extraordinary dividend appraisal Extraordinary dividend payment (if approved)

60 60 Dividends vs. Leverage 2, , , , ,00 0, ,00 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 Dividends (R$ million) Leverage (x)

61 Historical Dividend Yield (1) Considering Market Cap as of December, 31st, 2015 (1) Source: Bloomberg Financial Analysis - Multiples 61

62 Best dividend yields of 2015 among Brazilian corporate issuers Dividends per share (R$) Dividend Yield (%) Cesp Fibria Santander BR Qualicorp MRV BBSeguridade TelefBrasil Natura Braskem CSN Source: Economática the dividend yield calculation considers share price at the beginning of

63 Cost reduction initiatives and industry statistics 63

64 64 Structural Competitiveness 1. Third-party wood reduction NPV: US$0.4 billion 2. Forestry operations productivity NPV: US$0.6 billion 3. Industrial NPV: US$0.1 billion Total : US$1.1 billion

65 % wood from third parties Third-party wood reduction Wood supply recovering to normal condition Peaking in 2016; Returning to 2012 s levels by the end of 2017; NPV of R$1.4 billion from peak to normalized level. Third-party wood decrease will benefit opex andcapex % Planting 77% 84% 34% 63% 73% 67% 68% 75% 67% 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

66 63 1. Third-party wood reduction Losango Most part of the standing wood was already paid Despite the higher forest to mill distance, the wood from Losango is less expensive than the available wood from around Espírito Santo and Bahia States Positive impact over industrial costs due to better productivity

67 64 2. Forestry operations productivity Structural change improving competitiveness CLASSIFYING THE FOREST BASE BY CATEGORIES 45% 40% 35% 36% 40% 33% 30% 25% 20% 15% 10% 5% 10% 10% 20% 20% 15% 10% 6% 0% 01 - Diamond 02 - Gold 03 - Silver 04 - Bronze 05 - Lead Current effective area Future effective area The distribution costs by classes help us to apply resources in order to optimize wood production

68 65 2. Forestry operations productivity Identifying opportunities based on these combinations Possible Restrictions Possible Impediments Declivity 0: Higher than 35 1: Btw 24 and 35 2: Btw 0 and 24 Conservation Areas 0: Within CAs (1) 1: Within EPA (2) and EBZ (3) 2: Out of EPAs and EBZ Municipal Restrictions 0: Total restrictions 1: Partial restrictions 2: No restrictions EPA Altitude 0: Higher than 1800m 1: Lower than 1800m Urban Zones 0: Urban Zones 1: Outside urban areas Remnants of native vegetation 0: Remnants areas 1: Outside remnants areas Possible combinations X 0, 1 and 2, removed; (1) Conservation Areas (2) Envionmental Protection Areas (3) Environmental Buffer Zones 4 e 8, high potential

69 66 2. Forestry operations productivity Cost and Capex KPIs were also included in this geo-model Silviculture Harvest Roads Transportation

70 67 2. Forestry operations productivity Harvest Mixed Harvest Mechanization (Hilly areas) PROJECT DESCRIPTION (JACAREÍ UNIT) Mixed cutting operation with high demand for MO and high risk to safety; Harvest limitations in areas above 24 degrees; Increase annual capacity to harvest in areas up to 35 degrees, previously "locked up" by harvesting capacity of manual staff; NPV: R$71 million Capex: R$5 million Operational since Aug 2015

71 68 2. Forestry operations productivity Transportation PIFF Timber transportation Woodchip transportation PROJECT DESCRIPTION (ARACRUZ, JACAREÍ AND TRÊS LAGOAS UNITS) Freight cost reduction; Increased load box for timber/woodchip transport Use of lightweight steel; Operational risk reduction (flipping); Investment: R$33 million NPV: R$139 million Startup: 2015 / 2016

72 69 2. Forestry operations productivity Transportation Maritime Wood Shipping Project PROJECT DESCRIPTION (ARACRUZ UNIT) Capex and Opex reduction; Capex: R$38 million Increase in cargo handling due to increase in NPV: R$95 million stack height volume Startup: Jan/2017 Reduction in heavy truck road traffic

73 70 2. Structural change in forestry operations productivity Structural cost reduction of R$170 million per year (Capex + Opex) in 2020; NPV of approximately R$2 billion Seek opportunities for purchase / lease of more attractive areas, divest from unattractive land/forest, as well as the implementation of technologies that will lead us to the structural cost NPV Expected Curve 100% 90% 100% 80% 70% 60% 50% 40% 30% 20% 0% 10%

74 71 3. Industrial: maintenance downtimes schedule change Regulatory Standard 13 (Boiler and Pressure Vessel Inspection) extended the maximum period between recovery boiler inspections from 12 to 15 months. Fibria was the first company to use the extended period benefit NPV: R$385 million

75 72 3. Industrial: Biological Sludge Dryer Biological Sludge Dryness Process Operational Flow Conditioning and biological sludge burn Sludge drying and burn in biomass boiler Effluent+Sludge Aeration 00Tank Biological Sludge Tank Sludge Dryer Biomass 00 Boiler Biomass Pile PROJECT DESCRIPTION (JACAREÍ UNIT) Variable cost reduction associated with the disposal of sludge operations in external landfill Capex: R$18 million NPV: R$100 million Startup: Dec./2016

76 Global Market Pulp Demand Hardwood demand will continue to increase at a faster pace than Softwood Hardwood (BHKP) vs. Softwood (BSKP) (000 ton) Demand growth rate CAGR: Hardwood: +2.5% Softwood: +0.8% 000 ton Growth Growth Hardwood % 36% Eucalyptus % 52% Softwood % 16% Source: PPPC report (Sept. 2015) Hardwood Softwood Market Pulp % 27% Source: PPPC reports. Excludes Sulphite and UKP market pulp (Sept./15) Paper Production Runnability with BHKP Source: RISI conference, August

77 Benefiting From China s Growth China s Hardwood Imports of BHKP by Country (1) ( 000s t) BHKP Total Latin America (1) 1Q15 1Q Latin America is the leading exporter of BHKP to China, accounting to approximately 55% of China's total imports in 1Q Indonesia Others(2) USA Canada Western Europe (1) includes South Africa and New Zealand. (2) Includes China, Japan, Malaysia, Russia, Thailand and Vietnam. (million t) World Tissue Consumption, (3) Annual Growth Rate +3.7% (kg/person/year) N.America W.Europe E.Europe Japan China Asia FE Middle East LatAm Africa Oceania 30% 25% 20% 15% 10% 5% 0% Between 2005 and 2015, the Chinese market share of eucalyptus shipments increased by 20 p.p. (total market pulp: + p.p.) 10% 10% China's Share of Market Pulp (2) 12% 14% 21% 17% 22% 23% 23% 24% (million t) 14 25% 12 Eucalyptus Hardwood Total % Compared to the global Market Pulp (1) PPPC Pulp China Flash Report March 2016 (2) PPPC W20. Coverage for chemical market pulp is 80% of world capacity (3) RISI Per Capita Consumption of Tissue by World Region (3) (Kg/capita/year) N. West America Europe 11 Japan Oceania East Europe LatAm China Africa 1 77

78 set-09 dez-09 mar-10 jun-10 set-10 dez-10 mar-11 jun-11 set-11 dez-11 mar-12 jun-12 set-12 dez-12 mar-13 jun-13 set-13 dez-13 mar-14 jun-14 set-14 dez-14 mar-15 jun-15 set-15 dez-15 mar-16 jun Growth rate Chinese GDP vs. Eucalyptus Shipments to China (Sept-09 = base 100) China GDP Eucalyptus Shipments Source: Bloomberg and PPPC W20 report.

79 Commodities Differentiation China GDP breakdown 8% 4% 4% 3% 3% 2% 2% 2% 2% 2% 2% 44% 47% 48% 48% 48% 48% 48% 46% 47% 45% 45% 49% 49% 48% 49% 49% 50% 50% 52% 51% 53% 53% 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015E 2016E 2017E 2018E Consumption Investment Net Exports China commodity demand - basis 100 Corn Soybeans Wheat Crude oil Iron ore Sugar BHKP A 2009A 2010A 2011A 2012A 2013A 2014A 2015E 2016E 2017E 2018E Source: Itaú Macroeconomic Department and PPPC Oct/

80 E 2016E 2017E 2018E 2019E 2020E E 2016E 2017E 2018E 2019E 2020E Global Paper Consumption CAGR Developed Markets: - 2.1% Emerging Markets : + 5.6% CAGR Developed Markets: - 3.1% Emerging Markets : + 0.9% 103, , ,758 99,977 P&W Consumption (000 tons) (1) Developed Markets CAGR Developed Markets: + 1.5% Emerging Markets : + 6.6% Emerging Markets CAGR Developed Markets: + 1.4% Emerging Markets : + 5.9% 41,712 30,357 20,979 Tissue Consumption (000 tons) (1) Developed Markets Emerging Markets Source: RISI 80

81 81 Global Market BEKP Demand Shipments of Eucalyptus Pulp CAGR % (1) Source: PPPC World 20 January/ % 3,787kt 7% 3% 1,980 kt 6% 387 kt 662 kt 758 kt Total North America Western Europe China Others (1) Source: PPPC World 20 December/2015

82 mai-10 jun-10 jul-10 ago-10 set-10 out-10 out-10 nov-10 dez-10 jan-11 fev-11 mar-11 abr-11 mai-11 jun-11 jul-11 ago-11 set-11 out-11 nov-11 dez-11 jan-12 fev-12 mar-12 abr-12 mai-12 jun-12 jul-12 ago-12 set-12 out-12 nov-12 dez-12 jan-13 fev-13 mar-13 abr-13 mai-13 jun-13 jul-13 ago-13 set-13 out-13 nov-13 dez-13 jan-14 fev-14 mar-14 abr-14 mai-14 jun-14 jul-14 ago-14 set-14 out-14 nov-14 dez-14 jan-15 fev-15 mar-15 abr-15 mai-15 jun-15 jul-15 ago-15 set-15 out-15 nov-15 dez-15 jan-16 fev-16 mar-16 abr-16 mai-16 jun-16 jul-16 jul-16 BHKP prices - CIF China (US$/ton) Shipments (000 ton) Benefiting From China s Growth Source: PPPC Global 100 ( 000s t) China: Eucalyptus pulp shipments average: 250 ktons 2011 Average 379 ktons 2012 Average 370 ktons 2013 Average 439 ktons 2014 Average 504 ktons 2015 Average 538 ktons 2016 Average 603 ktons 82

83 USD/Adt, 2013 cost level Global BHKP Market Pulp Supply Cost Curve COST CURVE EVOLUTION Cost position of marginal producer Cumulative Capacity Million t/a Source: Pöyry. 83

84 Current Zero Cost Collars 3T16 4T16 1T17 2T17 3T17 4T17 1T18 2T18 ZCC (Notional em USD MM) Forward* 3,32 3,40 3,49 3,56 3,64 3,71 3,78 3,85 Put 3,31 3,36 3,52 3,57 3,64 3,67 3,62 3,64 Call 6,45 6,62 5,80 6,22 7,17 7,12 5,50 5,73 Notional (Total): US$ 1,285 million *forward curve average in the week of July, 20-26/

85 Free Cash Flow (1) US$ million Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 EBITDA Margin 33% 28% 30% 37% 37% 41% 39% 39% 41% 42% 41% 35% 35% 45% 50% 50% 56% 54% 52% 43% Average FX (1) Before expansion capex 85

86 (1) Considering FX (2) Considering average FX for the period 86 Fibria s tax structure Description and Amount Maturity (a) Operating income (-)(b) Goodwill (Aracruz acquisition) As stated in the income statement - Annual tax deduction: US$ 28 million (tax) - Remaining Balance June/16: US$ billion (base) 2018 (-)(c) Forestry Capex in MS state (net) (+/-)(d) Exchange variation (cash) 2016 tax deduction related to depletion: US$ 13.5 million Undefined (+/-)(e) Other Tax base before compensations (f) (-) Tax loss carryforward (a) + (b) + (c) + (d) + (e) - Up to 30% of tax base before compensations - Balance up to June/16: US$ 184 million (base) Undefined (g) Tax base Tax base before compensations tax loss carryforward (f) (h) Income tax Tax base (g) * 34% (i) (-) Federal tax credits Cash Tax Balance June/2016: -PIS/COFINS: US$ 202 million -Advanced tax payment (IR and CSLL): US$ 281 million - Reintegra: US$ 27 million Income Tax (h) tax credits (i) Undefined TAX PAYMENT (2) (cash basis) S16 US$ 9 million US$ 2 million US$ 8 million US$ 14 million US$ 12 million US$ 23 million US$ 7 million