Institutional Presentation 1Q14

Institutional Presentation – 1Q14 May 2014

KLBN11

Disclaimer

Institutional presentation 1Q14 – May 2014

The statements contained in this presentation related to the business outlook, operating and financial projections, and growth prospects

of Klabin S.A. are merely projections, and as such are based exclusively on the expectations of the Company’s management concerning

the future of the business.

These forward-looking statements depend substantially on the market conditions, the performance of the Brazilian economy, the industry

and international markets, and therefore are subject to change without prior notice.

This presentation on Klabin’s performance includes non-accounting and accounting data, such as operating and financial information, as

well as projections based on Management’s expectations. Note that the non-accounting data has not been reviewed by the Company’s

independent auditors.

The Company’s management believes EBITDA may provide useful information on the Company’s operating performance and allow for

comparisons with other companies in the same industry. Note however that EBITDA is not a measure established in accordance with

generally accepted accounting principles of the International Financial Reporting Standards – IFRS, and may be defined and calculated

differently by other companies.

A diferentiated company

Integration and Markets

Strongly linked to the consumer market

700 k tonnes

coated boards

1.0 mi tonnes

kraftliner

200 k tonnes

recycled paper

150 k tonnes

industrial bags

570 k tonnes

corrugated boxes

243 k ha eucalyptus and

pine forests

250 k tonnes

o.c.c. Sales volume destination

paper and packaging

68% Food

Building

Other consumer goods

Others

13%

7%

Paper Conversion Fibers End-users


Market position PAPER

Leader in the Brazilian packaging paper market, where we allocate more than 50% of our capacity

Coated Boards

Kraftliner

675 50%

market share

thousand tonnes sold in 2013

377

40% installed capacity

thousand tonnes sold in 2013

Sole supplier of liquid packaging board

in Latin America


Market position CONVERSION

Leader in the Brazilian packaging market where we allocate more than 95% of our capacity

Industrial Bags

Corrugated Boxes

50% market share

Second player’s market share is 16%

15% market share

Second player’s market share is 9%


From 2008 to 2013

HIGH RETURN INVESTMENTS

EXPANSION OF EVAPORATION SYSTEM

OTACÍLIO COSTA AND MONTE ALEGRE

BIOMASS BOILER

OTACÍLIO COSTA AND CORREIA PINTO

HIGH VOLTAGE

TRANSMISSION LINE MONTE ALEGRE

COST REDUCTION AND CHANGE IN

COMMERCIAL PRACTICES

MONTE ALEGRE, PR

OTACÍLIO COSTA, SC CORREIA PINTO, SC

FORESTRY UNIT

“INSOURCING”

MECHANIZATION OF SILVICULTURE AND

HARVESTING

EXPANSION OF CONVERSION

CAPACITY

NEW CORRUGATOR JUNDIAÍ DISTR. IND, SP

NEW CORRUGATOR GOIANA, PE

NEW INDUSTRIAL BAGS EQUIPMENTS GOIANA, PE

NEW PRINTERS FOR CORRUGATED BOXES


Adjusted EBITDA

1.562 million

R$

2013

962 milllion

R$

2010

1.028 million

R$

2011

1.352 million

R$

2012

Capacity of 1.7 million tonnes per year (excluding wood)

26% 26%

32% 34%

GROWTH

7% GROWTH

31% GROWTH

16%

2010 2011 2012 2013

MARGIN

1.602 million

R$ (Last twelve

months)

1Q14


1.8 million tonnes per year

From now on

HIGH RETURN INVESTMENTS

DEBOTTLENECKING AT THE WOOD YARD

MONTE ALEGRE

BIOMASS DRYING

PROCESS OTACÍLIO COSTA

COST REDUCTION

FORESTRY UNIT

CORRUGATED BOXES UNIT


Expansion projects NEW CAPACITIES

2013 2014 2015 2016

50,000 tonnes

per year

80,000 Tonnes per

year

debottlenecking coated boards (PR)

sack kraft machine(SC)

STARTED IN NOV/2013

recycled paper machine(PE)

110,000 Tonnes per year

PUMA project

1,5 million Tonnes per year

debottlenecking PIRACICABA AND

ANGATUBA

50,000 Tonnes per year


Growth Additional Capacities 3.5 million

tonnes per year

2016 E

2.0 million tonnes per

year

2015 E


year

2014 E


year

2013


1Q14 Results

Highlights 1Q14 VOLUME, NET REVENUE AND EBITDA

1Q13 1Q14

424 384

Adjusted EBITDA

(R$ million)

65%

30%

70%

35% 431

443

1Q13 1Q14

Sales volume

(excluding wood– tsd tonnes)

72%

24%

76%

28% 1.066

1.203

1Q13 1Q14

Net revenue

(R$ million)

Domestic market Export market


Paper business unit

14

Kraftliner

Recycled

Kraftliner and coated boards

Domestic market Export market

Kraftliner

Coated Boards

Thousand tonnes R$ million

1Q13

54%

46%

90

1Q14

69%

31%

105

1Q13 1Q14

171

138

-2%

1Q13

44%

56%

165

1Q14

45%

55%

161

1Q13 1Q14

376 415


Conversion business unit

15

Corrugated boxes

Industrial bags

Corrugated boxes and industrial bags

Total

conversion 1Q13

164

1Q14

173

1Q13 1Q14

468

525

Thousand tonnes R$ million


Net Debt/Adjusted Ebitda LAST TWELVE MONTHS

2,00

2

1,8

93

2,3

13

2,73

5

2,6

74

3,0

14

3,09

0

3,27

8

3,1

36

3,43

7

3,59

5

3,98

5

2,71

1

2.1 2.02.4 2.5

2.3 2.5 2.4 2.52.2

2.4 2.4 2.6

1.7

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14

Net debt

(R$ million)

Net Debt Net Debt / EBITDA (LTM)


Capex

R$ MILLION 2011 2012 2013 2014E 2015E

MAINTENANCE 296 390 369 372 360

SPECIAL PROJECTS AND

EXPANSION 159 264 431 431 -

VALE DO CORISCO 428 - - - -

PUMA PROJECT - - 99 2,762 3,470

TOTAL 883 654 899 3,565 3,830


Project Puma

The Project LOW OPERATION COST

272 MWh of ELECTRICAL ENERGY

production SELF SUFFICIENCY

122 MWh for internal

use

150 MWh to the market

enough to supply a city of 500 thousand inhabitants

ANNUAL PRODUCTION CAPACITY

1.5 MILLION TONNES OF PULP

1.1 million tonnes of SHORT

FIBER

400 thousand tonnes of LONG FIBER part converted into fluff


Project features PUMA

fluff production

production of hardwood pulp (eucalyptus) and softwood (pine)

lowest cash cost in Brazil

domestic sales


Project features LOCALIZATION

VALE DO CORISCO FORESTS

PARANA STATE

PUMA

MONTE ALEGRE

KLABIN FORESTS


Project features LESS FORESTRY AREA NEEDED

238 thousand hectares south USA

140 thousand hectares Brazil

300 thousand hectares Europe

700thousand hectares nordic countries

160 thousand hectares Chile

planted forest needed for a 1.5 million tonnes of hardwood pulp mill

HUGE PRODUTIVITY

100 thousand hectares KLABIN PUMA


Products

EUCALYPTUS PULP BEKP IN BALES

PINE PULP BSKP

IN BALES

FLUFF IN REELS

MADE FROM BSKP

PUMA PROJECT PRODUCES 3 DIFFERENT TYPES OF FIBER that could lead to combined sales to the same client

BEKP: bleached eucaliptus kraft pulp BSKP: bleached softwood pulp


World demand BLEACHED PULP

11.6 million tonnes OTHER SHORT FIBER

6.5 million tonnes

FLUFF

16.5 million tonnes EUCALIPTUS

17.4 million tonnes

LONG FIBER

SOURCE: HAWKINS WRIGHT

SHORT FIBER 28 million tonnes

LONG FIBER

24 million tonnes

52 MILLION TONNES IN 2013


World demand SHORT FIBER

SOURCE: HAWKINS WRIGHT 2013

CAGR 3.3%

2013 anualizado

28.2 million tonnes

SHORT FIBER

2013

32.2 million tonnes

SHORT FIBER

2017


Market LONG FIBER

SOURCE: BRACELPA

LONG FIBER IMPORTS IN BRAZIL

DOMESTIC MARKET FOCUS IMPORTS SUBSTITUTION

GROWTH 7%

439 thousand

tonnes

IMPORTED LONG FIBER

2013 anualized

410 thousand

tonnes

IMPORTED LONG FIBER

2012


Market FLUFF

DISPOSABLE DIAPERS DEMAND IN BRAZIL

SOURCE: EUROMONITOR INTERNATIONAL

fluff domestic demand is expected to grow significantly

imports substitution

Major markets: infant and adult diapers and women

disposal

5.8 billion units

DISPOSABLE

DIAPERS

2007

9.8 billion units

DISPOSABLE

DIAPERS

2012

11.8 billion units

DISPOSABLE

DIAPERS

2017E

CAGR 11%

CAGR 4%


Fluff, long fiber and short fiber prices

CIF E

uro

pe p

ric

e (

US

$/

ton

ne)


SOURCE: RISI/FOEX

600

650

700

750

800

850

900

950

1000

1050

1100M

ar-1

0

May

-10

Jul-

10

Sep

-10

No

v-1

0

Jan

-11

Mar

-11

May

-11

Jul-

11

Sep

-11

No

v-1

1

Jan

-12

Mar

-12

May

-12

Jul-

12

Sep

-12

No

v-1

2

Jan

-13

Mar

-13

May

-13

Jul-

13

Sep

-13

No

v-1

3

Jan

-14

Mar

-14

Fluff

SBSK

BHKP

Global cash cost (short fiber)

SOURCE: HAWKINS WRIGHT

5 10 15 20 25

700

600

500

400

300 PUMA

annual capacity (millions of tonnes)

CIF E

uro

pe c

ash

co

st

(U

S$

/to

nn

e)


Commercial strategy

KLABIN WILL NOT AIM FOR

LARGE VOLUMES

SHORT FIBER

1

LONG FIBER

2

FLUFF 3

DOMESTIC MARKET

4

EXPORTS 5

INTEGRATION 6

PUMA


Logistics SHORT DISTANCES

72 Km forestry average

distance

pulp mill forests 441 Km

railway to the port Paranaguá port EXPORTS

highway

DOMESTIC MARKET

INBOUND OUTBOUND


Capex and Funding

R$ 5.8 billion reais INDUSTRIAL CAPEX

R$ 7.2 BILLION REAIS

CAPEX FUNDING

R$ 7.2 BILLION REAIS

R$ 0.8 billion reais RETURNABLE TAXES

R$ 0.6 billion reais OFF THE FENCE(recovered)

R$ 4.2 billion reais BNDES

R$ 0.7 billion reais ECA’s

R$ 0.6 billion reais IDB

R$ 1.7 billion reais CAPITALIZATION


CONTRACTED

Project Status

Earthmovement well advanced

Start up: march 2016

100% of industrial equipment contracted

Civil construction already started


Under negotiation: Railcars and bridges

Earthmovement


Appendix

Income statement


Units After the 4th period of conversion

1084 MM

71 MM

KIC/NIBLAK Others

80 MM

71 MM

30 MM

433MM

BNDES Monteiro Aranha Treasury Others

282 MM

222 MM

ADR's Others

KLBN3 – 1155 MM sharesKLBN11*– 614 MM Units1 KLBN11 = 1 ON + 4 PN’s KLBN4 – 504 MM shares

*614 MM of ON shares2,456 MM of PN shares


k l a b i n . c o m . b r

Thank you!

Documents

Institutional Presentation 1Q14