comunicado ao mercado sobre reuni

7/27/2019 Comunicado ao Mercado sobre Reuni

1/76

Financial Highlights

Guilherme Cavalcanti - CFO


2/76

Focus on Investment Grade

Main Achievements

US$ 1.4 billion debt reduction in twelve months

Net debt/EBITDA ratio in US$ of 3.0x, the lowest level since Fibrias creation Cost of debt in US$ reduced to 4.7% p.a. (Jun/12: 5.4% p.a)

Free cash flow in the LTM totaled R$956 million, 7% FCF yield

Working Capital Improvements

Hedging Strategy All rating agencies at one notch below Investment Grade:

Outlook upgrade by Fitch (Feb/2013) and Moodys (Sep/2013)

Rating upgrade from BB/Positive to BB+/Stable by S&P (Mar/2013)

Selected as sector leader in Dow Jones Sustainability Indices

2


3/76

1,247

485

183

(648)

(109) (5)

(220)

(102)

36

(16)

Netrevenues

COGS/Freight

SG&A Others EBITDA CAPEX Interest WorkingCapital

Taxes/Others

LTM 2Q2013

(1) On a cash basis, does not include depreciation, amortization and depletion (2) Includes advance to forest partner program (3) IR/CS and other

(2)

FCF Yield 7%

(1) (3)

LTM 2Q13 Results (R$/ton)

Fibria delivers one of the highest EBITDA/t andFCF/t of the industry

3


4/76

Acknowledgements

4

Company of the year,among all industries,according to ValorEconmico.

In the Pulp and Paper Sector:1st place in Value Generation1st place in Net Revenue

Valor 1000

XVII ANEFAC-FIPECAFI - SERASAEXPERIAN Prize

Fibria is among the mosttransparent publiccompanies (with revenueof up to R$5 billions) inBrazil; recognized for the

quality of its 2012financial statements.

Fibria was ranked for the forthconsecutive year (2010, 2011,2012 and 2013).

In 2013 Fibria was ranked infour categories: CEO, CFO, IRTeam and IR Professional

2013 Institutional Investor LatamRanking - P&P Sector

Fibria was chosen byRobecoSAM as one of the 10Game Changers of tomorrowamong all the industriesworldwide analyzed at DowJones Sustainability Index.Fibrias case was published inthe Sustainability InvestingMagazine.

Sustainability Investing

Fibria was elected by pocaNegcios 360 as 1st place inthe pulp & paper sector in thecorporate governance andfuture's vision categories.

poca Negcios 360

Fibria is one of the 5Brazilian companiesnominees to the BestCorporate GovernanceAward from London.

International Recognition byCorporate Governance Report


5/76

Share Performance

5

-

50

100

150

200

250

Fibria Ibovespa

Base: 100 Source: Bloomberg

+2%

+118%


6/76

MARKET PULPENTERING A NEW AGE OF COMPETITION

2ND FIBRIA INVESTOR TOURTrs Lagoas, MS, October 2, 2013

Joo CordeiroPyry Management Consulting


7/76

COPYRIGHTPYRY

KEY QUESTIONS

02 OCT 2013

What has fundamentally changed in thebusiness of market pulp during the lastfour decades ?

How to compete in the future given theevolving dynamics of markets, clientsand competitors ?

How to innovate and create competitiveadvantage while coping with risingoperating costs ?

FIBRIA INVESTOR TOUR 7


8/76


9/76

COPYRIGHTPYRY

WE ARE WITNESSING A MAJOR STRUCTURAL SHIFT

0

100

200

300

400

500Million tons

Mature

Emerging

Structural Shift:

Mature markets

Graphic paper sunset Diminishing availability of RCF

Emerging Markets

More Packaging & Hygiene More Specialties Graphic papers ?

Global Paper and Board Demand 1980-2025

Graphic

Papers

*RCF: recycled fibreSource: Pyry

02 OCT 2013FIBRIA INVESTOR TOUR 9


10/76

COPYRIGHTPYRY

CHINA IN THE DRIVING SEAT OF FIBRE DEMAND

0

50

100

150

200

250

1996 2000 2004 2008 2012

1.8%/a

13.2%/a

China

0

15

30

45

60

75

1996 2000 2004 2008 2012

0.7%/a

15.1%/a

Recycled Fibre

Demand

China

Market Pulp

Demand

Rest of the WorldRest of the World

CAGR CAGR

Million tons Million tons

Source: Pyry



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COPYRIGHTPYRY

WHILE THE SHARE OF MARKET PULP INCREASES.


20

30

40

1995 2000 2005 2010 2015 2020 2025

%

Share of Market Pulp*

* share of market pulp out of total wood pulps

Total Share of BHKP

1995 38 13 34%

2015 65 32 49%

2025 78 42 54%

Global Market Pulp Demandmillion tons

Source: Pyry


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COPYRIGHTPYRY

WHAT HAVE BEEN THE MAIN CHANGES

IN MARKET PULP BUSINESS DURING THE LAST 40 YEARS

02 OCT 2013FIBRIA INVESTOR TOUR

WoodQuality & Cost

Technology andMill Size

and what is the future impact on Brazilian business ?

LouderClient Voice

12


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COPYRIGHTPYRY

CAPITAL AND WOOD COST INTENSITY


Kraft Pulp Mill Capex Wood Cost

0%

5%

10%

15%

20%

25%

1974 1986 2002 2006 2013

Pulp Price Assumed in Feasibility Study = 100%

Savings from economies-of-scale were offset but higher wood costs ?

Source: Pyry

13

0

1.000

2.000

3.000

4.000

1974 1986 2002 2006 2013

USD/ADt (real 2013)


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COPYRIGHTPYRY

SIZE STILL MATTERS !

-500

-250

0

250

500

750

1.000

1.250

5.0 % 6.0 % 7.0 % 8.0 % 9.0 % 10.0 % 11.0 % 12.0 % 13.0 %

IRR

WACC (%)

NetPresentValue

USD million

750 000 t/a

1.5 M t/a

1.3 M t/a

1.0 M t/a

ILLUSTRATIVE


Illustrative NPV Sensitivity to WACC and Mill Size

Source: Pyry

14


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COPYRIGHTPYRY02 OCT 2013

FIBRIA INVESTOR TOUR

WHY WOOD COSTS ARE RISING ? 1979

15


16/76

COPYRIGHTPYRY

10

2030

40

50

60

7080

90

100

110

120


THE END OF CHEAP WOOD ?

Development of hardwood pulpwood cost delivered at mill

USD/msob, real terms 2012

Source: Pyry

16

Finland Birch

Brazil Euca

US South Mixed HW

Note: Deflator used for real prices US WPI


17/76

COPYRIGHTPYRY

WAR AGAINST WOOD COST INFLATION !


Real cost increase of:

Labour Land

Fertilizer Herbicides Fuel etc

What are the main causes of rising wood costs ?

Index 2000=100

100

200

300

400

2000 2003 2006 2009 2012

INCAF

IPCA

Brazilian Wood Cost Index

Brazilian inflation

Source: Pyry

17


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COPYRIGHTPYRY

FOREST PRODUCTIVITYARE WE REACHING A CEILING?


1970s 2010s

m3/ha.aPlantation Forest Productivity in Brazil

Source: Pyry

18


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COPYRIGHTPYRY

GENETICS

KEY ASSET FOR FUTURE DIFFERENTIATION



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COPYRIGHTPYRY02 OCT 2013

FIBRIA INVESTOR TOUR 20

NEW COMPETITION ON ASIA?


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COPYRIGHTPYRY

0

200

400

600

800

1 000

1 200

1 400

1 600

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34

THE WORLD IS FLAT

Global BHKP Supply Cost Curve

Cummulative Capacity Million t/a

1991

1996

2001 20062012

Cost positionof marginal

producer

The model has been copied by manythe result is this !

Source: Pyry


USD/ADt,2013costlevel


22/76

COPYRIGHTPYRY

BRAZILIAN MILLS HAVE AN ADVANTAGE

OVER CHINESE FOR DELIVERIES TO CHINA

Cash cost competitiveness of market BHKP mills delivered to Hong Kong


0

200

400

600

800

1000

1200

0 1000 2000 3000 4000 5000 6000 7000 8000

USD/ADt 2013/II

BEKP net price in China

Cumulative Production Capacity 1000 ADt/a

Brazilian mills

Chinese mills

Source: Pyry

22


23/76

COPYRIGHTPYRY

INCREASING SHARE OF BRAZILIAN MARKET PULP


There is room to further consolidate the market pulp business !

Eldorado

Mercer Int

Domtar

Weyerhaeuser

Mets Group

UPM

APP

Suzano

Georgia-Pacific

CMPC

Stora Enso

International PaperArauco

RGM/APRIL

Fibria

Top Bleached Kraft

Pulp Producers in 2013

Brazilian Share of Global

Bleached Kraft Market Pulp

0

15

30

1980 1990 2000 2013

%

BHKP

BSKP+BHKP

BHKP

BSKP

Source: Pyry

23


24/76

COPYRIGHTPYRY

NEW COMPETITION ON ASIA ?


0

5

10

15

20

25

Integrated Market

Up to 2025, more than 30 million tons including integrated and market pulp.

0

5

10

15

20

25

Brazil China Rest of Asia

BHKP

BCMTP

Planned

Decided

Million tons Million tons

MainlyMarket

MainlyIntegrated Many

Plans

Source: Pyry

Announced BHKP and BCTMP capacity changes in Asia and in Brazil

24


25/76

COPYRIGHTPYRY

BUT SOME CAPACITY GETS CLOSEDEVERY YEAR

FIBRIA INVESTOR TOUR

Not everyone remembers that on average some 3 million tons

of bleached kraft pulp gets closed every year !

-6,0

-5,0

-4,0

-3,0

-2,0

-1,0

0,0

2000 2002 2004 2006 2008 2010 2012

Million tons

02 OCT 2013

Global Annual Closures and Integration ofBleached Kraft Pulp Capacity

Source: Pyry

BHKP Market

BHKP Integrated

BSKP Market

BSKP Integrated

25


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COPYRIGHTPYRY

AN EYE ON THE FUTURE

BIO-BASED FUELS, CHEMICALS AND NEW MATERIALS


Sugar

platform

Oil & Fats

platform

Bioplastics

Surfactants

Lubricants

Solvents

Bio-based

fuels &

chemicals

Coca Colas plant bottle Disposable plates & cupsAutomotive interior

Detergents Healthcare & cosmetics Industrial cleaners

Marine oils Chainsaw lubricants Drilling fluids

Paint & coatings Inks De-icing agents

e.g tall oil rosins,ethylene, lactic acid,propylene glycol,propanediol, farnesene,succinic acid, butanediol


27/76

COPYRIGHTPYRY

ENTERING A NEW AGE OF COMPETITION


Are we ready to

reinvent ourIndustry?

Mill sizes will continue to increase.

Declared war on wood cost inflation.

Facing emerging competition from withinBrazil and from South East Asia.

More differentiation and innovationthrough intensive R&D from forest to product.

Develop Fit-for-client product andservice portfolio in order to differentiate

Taking an active role on consolidation whilebringing investment discipline to the industry.

27


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COPYRIGHTPYRY 2802 OCT 2013FIBRIA INVESTOR TOUR

Questions ?

Mr. Joo [email protected]

It is not the strongest of the species that survives, nor the most

intelligent, but the one most responsive to change.

Charles Darwin
mailto:[email protected]:[email protected]


29/76

Competitive Strategy

Marcelo Castelli - CEO


30/76

Th t it f i t d i Fib i


31/76

STRUCTURE AND PROCESS SIMPLIFICATION

SG&A (R$ million)EBITDA (R$ million) - EBITDA MARGIN (%)

TARGET TO FULLY ABSORB INFLATION

CASH COST (R$/ton)

BEST PRACTICES AND OPERATING STABILITY

PRODUCTION VOLUME (000 t)

The maturity of synergies captured since Fibriascreation improved its operating indicators

31

Historical Value Inflation Effect**

* Excludes Conpacel | ** IPCA index considered to calculate the inflation effect

4,600

5,0545,184 5,299 5,246

2009* 2010* 2011 2012 2Q13 LTM

432 448 471 473497

578 556 534 507

2009* 2010* 2011 2012 2Q13 LTM

+14% -14%

Historical Value Inflation Effect**

-24%

593 594 605 584 605

793 737 687626

2009* 2010* 2011 2012 2Q13 LTM

1,522

2,526

1,9642,253

2,53729%

40%34% 36%

39%

2009* 2010* 2011 2012 2Q13 LTM


32/76

* From June 30, 2012 on, net debt/EBITDA ratio for covenant purposes are calculated in US Dollars and the limit is 4.5x** 2013 year end market consensus

and reduced its debt.

6.5

3.6

4.8

3.4 3.1 3.32.7

7.1

3.8

4.23.3 3.1 3.0

Net Debt/EBITDA (x) R$

Net Debt/EBITDA (x) US$*

MarketConsensus

11.0

9.8 9.5

7.7 7.58.3

2009 2010 2011 2012 1Q13 2Q13 2013**

NET DEBT (R$ BILLION)

FX RATE (R$/US$)

1.67

1.76

1.74

2.00Average LTM

End of Period 1.87

1.67

1.95

2.04

2.01

2.00

2.22

2.07

32

2.24

2.13


33/76

The demand for pulp reaches historical levels,driven by eucalyptus pulp

33

GLOBAL DEMAND FOR PULP (IN MT) ACCUMULATED GROWTH IN THEDEMAND FOR PULP (1991 - 2012)

29 3031 33

35 35 36 38 3841 41 42

44 4648 49

51 53 52 5254

56 57

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Softwood Eucalyptus pulp

Other types of hardwood Other

68%

89%

13%

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Softwood Eucalyptus pulp

Other types of hardwood Other

Source: Hawkings Wright, Analysis of Fibrias Strategy Department

379%

89%

68%

13%


34/76

Source: RISI, LCA, Analysis of Fibrias Strategy Department

Growth prospects for the paper industry remainpositive in almost every grade

GDPTISSUE NEWSPRINT PACKAGINGP&W

GLOBAL

Oceania

Africa

Latin America

Asia (ex-China)

China

Europe

North America -2.9%

-1.9%

2.6%

1.2%

2.7%

3.6%

-0.5%

0.3%

1.4%

3.2%

8.8%

3.1%

4.8%

5.4%

2.3%

4.2%

-4.7%

-3.6%

-1.8%

-1.1%

0.7%

1.6%

-3.7%

2.3 %

1.1%

1.6%

4.4%

3.5%

3.4%

4.3%

0.6%

2.9% 3.7%

4.7%

6.6%

4.6%

1.4%

3.4%

3.0%

2.5%

CAGR OF DEMAND BY REGION AND TYPE OF PAPER2012 - 2022

34


35/76


36/76

Fragmented industry with new ongoing projects

36

MARKET PULP CAPACITY RANKING 2013 (1) (000T)MAIN PROJECTS

0 2000 4000 6000

Canfor

ENCEWest Fraser

Eldorado

Metsa Fibre

Mercer

IP

Ilim

Domtar

Stora Enso

WeyerhaeuserPaper Excellence

Suzano

Sodra

UPM-Kymmene

CMPC

Georgia Pacific

Arauco

APRIL

Fibria

Bleached Softwood Kraft Pulp (BSKP)

Bleached Hardwood Kraft Pulp (BHKP)

Unbleached Kraft Pulp (UKP)

Mechanical

Project Country Capacity Timing Fiber Status

Suzano Brazil 1.5 Mt 4Q2013 BEKP Confirmed

Arauco / Stora Uruguay 1.3Mt 1Q2014 BEKP Confirmed

CMPC Guaba II Brazil 1.3 Mt 2Q2015 BEKP Confirmed

Klabin Paran Brazil 1.5 Mt(2) 2Q2016BEKP/

BSKP/FluffUnconfirmed

Fibria Trs Lagoas IIBrazil 1.5 Mt - BEKP Unconfirmed

APP South Sumatra Indonesia1.5 Mt -2.0 Mt

- BHKP Unconfirmed

MAIN QUESTIONS ABOUT CAPACITY

Minimum required return for new projects

Closures due to increasing costs, higher technicalage of recovery boilers and exchange rates

Fiber substitution: Softwood x Hardwood andRecycled x Virgin Fiber

(1) Hawkins WrightOutlook for Market Pulp, January 2013

(2) About 1.0 Mt refers to hardwood market pulp

I dditi th l f j t t


37/76

450

700 700900

780

11001300

1500

2000

2.7%

3.8%

3.4%

4.3%

3.5%

4.7%5.2% 5.5%

6.5%

2000 2002 2004 2005 2006 2007 2009 2013 2017

In addition, the scale of new projects represents astronger impact on the industrys operating rate

37Source: Analysis of Fibrias Strategy

EVOLUTION OF AVERAGE SCALE OF HARDWOOD PROJECTS (KT) AND % OVER DEMAND

Main Projects HW % over Total Demand

Gi th i Fib i i di if i it


38/76

Given the scenario, Fibria is diversifying its sourcesof value creation.

Drivers of continuous improvement and innovation Continuous search for operating excellence and cost control initiatives

Forestry biotechnology

Development of customized products - fit for client

Actions to reduce employed capital

Growth initiatives

Complementary actions in the Value Chain

38

Fib i ti l t t i t


39/76

Fibrias operational strategies tocompetitiveness and growth

IncrementalInnovations

TechnologicallyAdvancedWorkforce

Control ofInternalInflation

Stabilityfor Cost andProductivity

Performance

SpecificProjects

for Cost Reduction

39

R lt f i t t i d ti f


40/76

Results of winner strategies and perspectives fornear future

Technically Advanced Workforce I9 Program Quantitative Ideas (n) Raw Materials Internal Inflation (%)

Operating Stability (%) Production (t/day, full year 354d) Cash Cost (R$/t)

90.5

91.892.5

2010 2011 2012 NEAR FUT

14.28

14.6414.92

2010 2011 2012 NEAR FUT

6.4 6.36.9

2010 2011 2012 NEAR FUT

448

471 473

2010* 2011 2012 NEAR FUT

182 170 165

2010 2011 2012 NEAR FUT

STABLESTABLE

NPV Captured = Mi R$350Reward = Mi R$2.6 Engineers: 80% are Pulp Specialists

Operators:60% are Pulp Technician

Maintenance:70% Specific Training

Qualifications:Continuous Program

Products Development: AP Product, EucaStrong, High Kappa, Low Brightness are improved or new products

Aracruz + Trs Lagoas +

Jacare + 50% Veracel

Average official Inflation6.1% per year

>90 % Excellence

>87 % Good>84 % Regular

40

O ti St bilit b d t d ti


41/76

Jacare Production t/dSep 2013

Operating Stability based on nonstop productionBright September!!

Trs Lagoas Production t/dSep 2013

41

Veracel Production t/dSep 2013 Aracruz Production t/dSep 2013

OS = 97,4 % OS = 97,5 %

OS = 96,4 % OS = 92,6 %

The biggest

Stability&

Production

of the year

S ifi j t f t d ti ( l )


42/76

ARACRUZWarm up D0 Stage at Mill C

Specific projects for cost reduction (examples)

Objectives (Investment = R$2.4 Million):Increase Kappa number Dig CCAT reductionIncrease Tensile Index of Line C pulp

42

Potential Gains:Cash Cost Unit = - 0.62 R$/tCash Cost Fibria = - 0.31 R$/tStart-up: May/2014

Bleaching Line C

S ifi j t f t d ti ( l )


43/76

Specific projects for cost reduction (examples)

JACAREImprovements at Fiber Line C

Objectives (Investment = R$6.2 Million):Reduction of 3 kg/t of Chlorine Dioxide as TAC

43

Potential Gains:Cash Cost Unit = - 2.90 R$/tCash Cost Fibria =- 0.68 R$/t

Start-up: Aug/2014 and Sep/2015


44/76

UAVs Unmanned Aerial Vehicle (DRONE)


45/76

UAVsUnmanned Aerial Vehicle (DRONE)

3 years of developmentOperational Scale Oct/2013

Productivity increase up to 700 ha/h

Forest view from above

45



46/76


46



47/76

SURVIVAL REPORTCOPPICINGMAPPING


PRODUCTS

Survival

Weeds Management

Validation of Coppice

Cartographic survey

47

Harvester + Forwarder With Winch


48/76


Mooring system of forest machines intheir own trees from the edge of the field

48


49/76


50/76



51/76


+ 20% mechanized area (JAC)

~ 450 thousand m wood

CAPEX: R$7 million (2013/2014)

Cash Cost Fibria: ~ - 0.80 R$/adt

Cash Cost Jacare: ~ - 4.00 R$/adt

NPV 66 millionAnnual Saving R$ 5 million

90 % Mechanized70 % Mechanized

51

Hook Up System


52/76

Hook Up System

"Hook up system" is a kit to optimize the flow of hydraulic oil from the base machine

to the head (74 machines)

Reduction in diesel consumption

Improved performance of the assembly.

Source: colheita ARA 52

Hook Up System


53/76

LITERS PER HOUR

Hook Up System

22.6

19.8

Before After

Payback at the first monthAnnual savings R$ 1 million

- 12.4%

53

Productivity gains


54/76

Productivity gains

MAI* Pulp:(adt/ha/year)

10.6 10.912.1

15.0 15.0 15.0 15.0 15.0

2010 2015 2020 2025 2030 2035 2040 2045

Expected results in the new forests planted in Fibrias own forests, adopting classical breeding +molecular markers technologies.

FIBRIAS GAINS IN IMACEL DUE TO INVESTMENTS IN BIOTECHNOLOGY (TONS OF PULP/HA/YEAR)

2012 field trials = 11.9

Conservative assumption

*MAI: Mean annual increment

How: Genetic improvement; forestry management; industrial yield.

Benefits: Availability of land for other purposes; increase in competitiveness; higher return to

shareholders and to the society as a whole.

54

Innovation in the Core Business


55/76

Innovation in the Core Business

The Technology Center (CT) operates within all company units and is directly involved with Fibriasmain operations, from the production of seedlings to the development of new products andservices.

The product portfolio is fully aligned with Fibrias strategy and is managed by a system based onthe Stage and Gate methodology.

In 2013, projects are distributed in the following dimensions:

Operating excellence

Differentiation through disruptive technologies

Business sustainability (social and environmental development)

New businesses

55

Redirecting the innovation focus


56/76

Redirecting the innovation focus

29%

47%

6%

18%

Business sustainability Disruptive technologies

New businesses Operating excellence

35%41% 47%

52%36%

18%

13% 23%29%

6%

2011 2012 2013

Disruptive technologies Operating excellence

Business sustainability New businesses

34%

56

2013

Biotechnology: Plant Propagation


57/76

Biotechnology: Plant Propagation

Clone multiplication in laboratory: BIOUNITS

Successful Case 2013 XIII ANPEI Conference on Technological Innovation

Increase by 40 times in the clone multiplication rate

38% decrease in the seedling production time (cycle)

57

Forest Biotechnology:


58/76

Forest Biotechnology:Genetic Transformation of Elite Clones

The Genetic Transformation of the elite clones is a technological rupture held by Fibria.

77 ha of field experiments already installed: focus on the technological bio-safetyassessment.

Fibria does not have commercial crops with transgenic eucalyptus.

58

Product Development


59/76

Product Development

59

Fiber differentiation

through chemicalboosting

Fiber differentiation

through forest and/orprocess tunning

Pulp application

engineering:Capabilities & Know-how

DRIVERS

1. Papermaking performance improvement2. Paper performance improvement

3. Share increase by displacing RF, SWKP and/or other HWKP

Fiber Differentiation


60/76

Fiber Differentiation

60

TensileD

evelopment

Drainability through refining

NSK Avg EU/NA

EUCASTRONG

BEKP

Bulk

Tensile

NSK Avg EU/NA

EUCASTRONG

BEKP

Bulk

Tensile

Becames PossibleEucastrong

TypicalBehavior

Pulp Application Combination of


61/76

BEKP refined as usual

Pulp Application Combination ofCapability and Know-How

61

Fibriahas protocols and commercial equipment dedicated to assist and to recommendoptimized refining strategies.

BEKP refined at ULIR(1)

Source: Fibria and Eucalyptus Pulp for Tissue Making: A winning design, Tissue World 2009 Nice, France - Fernando S. Lafraya, AFINA Consulting(1) Ultra Low Intensity Refining

Fibrias BEKP Expertise:


62/76

Fibria s BEKP Expertise:Anticipating Market Movements

62

Technologies had allowed the increase of BEKP up to 70%in NA premium bath tissue!

0%

20%

40%

60%

80%

1960s 1970s 1980s 1990s 2000s 2010

Participation

in

theF

urnish

Premium Bath 2-Ply

HW HW (euc) %

SW (BSK) % Broke %

Source: Fisher International, Inc. January 2011

(other) %

There are various options to reduce capital


63/76

p pexpenditures in Fibrias value chain

POTENTIAL ACTIONS TO REDUCE EMPLOYED CAPITAL

LAND

Sales of areas with high real estate potential

Real estate land funds

FOREST

Creation of planting funds, defining purchase options for wood(new and current areas)

INDUSTRY AND LOGISTICS

Outsourcing of non-core production phases and logistics assets

63


64/76

Fibria is preparing for its organic expansion, based


65/76

p p g g pon a model that creates different growth options

STRATEGY FOR POTENTIAL ORGANIC EXPANSION

1. Maintain forest formation through: Implementation of new areas Renting Partnership with TIMOs Reinvestment of resources from assets divestments

2. Obtain licensing for all potential expansions

3. Continuous investigation of new low cost areas

Usage of wood fororganic growth

Wood sales in themarket or usage in new

businesses

Usage of areasin M&A events

65

Horizonte II Projecta way to growing!


66/76

j y g g

3 WoodPreparation

Lines 17,200 m3/d

1 Digester5,100 Adt/d

1 Fiber Line4,750 Adt/d

2 Drying Machines

2 x 2,500 Adt/d4 Baling Lines

TRS LAGOAS LINE II

1 Effluent Treatment132,000 m3/d

1 Water Treatment144,000 m3//d

1 Recovery Boiler6,800 TSS/d

3 Turbogenerator3x 80 MW

1 Lime Kiln1,200 t/d

1 Evaporation1,600 t/h H2O

1 Caustisizing15,000 m3WL/d

66

Electric Power Export tripled with Line II


67/76

p pLow CO2 Emission Matrix

LINE I + IP PM1

90 MWRB1

RB2

PB1

PB2

TG1

TG2

TG3

TG4

TG5

81,5 MW

81,5MW

80 MW

80 MW

80 MW

Escelsa

Export50 MW

GreenMatrix

MultipleFuel

Sources

Licor

85%

Gas7%

Biom8%

Total LI + LIIExport

150 MW

10 MW

LINE II + IP PM2

104 MW

Export

100 MW

LKLegend:TG - Turbo GeneratorPB - Power BoilerRB - Recovery BoilerLK - Lime Kiln

Stean Power

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Fibria is prepared to grow


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p p g

Installation License: L I n. 84/2011 revalidated to 2017

Authorized Capacity: 1,750,000ADtB/year (4,794 tpd)

Total Capacity: 3,050,000 ADtB/year (8,616 tpd)

Other Authorizations:

Co-generation: 259,5 MW

Expansion & New Capacity of Landfill: 204,800 + 750,000 m3

Production of Soil Corrective from Residues: 31,000 t/year

Burns of Secondary Mud from ETE in Biomass Power Boiler

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Growth from consolidation present challenges,


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p gbut benefits are undisputed

CHALLENGES

Strategic motivation and timing of the otherparty

Relative valuation

Governance, control issues

Debt level of players

BENEFITS

Huge potential synergies

Market and client portfolio consolidation

Rationalization of pipeline of new project

GROWTH FROM CONSOLIDATION IS KEY DRIVER FORVALUE CREATION

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Complementary actions include assessing


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opportunities in biotechnology and in the logisticschain

Value drivers to improve on the current situation

Growth Initiatives

Complementary actions in the value chain Opportunities in the Bio-market Actions in the Logistics Chain

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The value chain of the Forestry Industry has


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LAND

opportunities to be explored

VALUE CHAIN OF THE FORESTRY INDUSTRY

FOREST FINAL USES

Land

What is the best finaluse for investments

in land?

What is the bestfinal use for

wood ? FurnitureInd.

Charcoal

Pulp

Standingtimber

Power

MDF, particleboard

Pellets

Biofuels

OtherBusinesses

Sale to thirdparties

Bio-Products

Paper

Lease land

Wind power

Forestry

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Aware of these opportunities, Fibria has beeninvestigating a series of technologies


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investigating a series of technologies

TechnologicalMaturity

Economic Attractiveness

Technology A

Technology B

Technology E

Technology F

Pyrolysis

Technology D

Prior i ty 1

P-Oil

Prior i ty 2

RelativeMarket Size

Source: Fibria Bio-Strategy Project

Economic Attractiveness

Technology Fibria

PyrolysisEffective participation: Ensyn

investment

Gasification On going studies

PelletizationLittle attractive under current

conditions

Cellulosic Ethanol On going studies

Bio-chemicals On going studies

Bio-polymers On going studies

Lignoboost Pilot equipment

Carbon Fiber Strategic partnership

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Conceptual LayoutBio-Oil Plant


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Fibria can add value by taking advantages of


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the opportunities in the logistics chain

OPPORTUNITIES IN THE LOGISTICS CHAIN

Taking advantage of Portocels opportunities (current operations and expansion)

PORTOCEL I PORTOCEL II

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comunicado ao mercado sobre reuni

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