BofA Merrill Lynch 2015 CalGEMs

Global Emerging Markets 1x1 Conference

June, 2015

FIBRIA APP WITH THIS PRESENTATION IS AVAILABLE FOR DOWNLOAD AT APPLE STORE AND GOOGLE PLAY.

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
companys 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.

1
2 Pulp and Paper Market
3 Financial and Operational Highlights
4
Company Overview

Final Remarks

Agenda

Company Overview
4

A Winning Player
Superior Asset Combination

Belmonte
Veracel
Caravelas
Portocel
Aracruz

Main Figures 1Q15 LTM

Pulp capacity

million tons

5,300

Net revenues

R$ billion

7.4

Total Forest Base(1)

thousand hectares

968

Planted area(1)

thousand hectares

561

R$ billion

9.0

2.3

Net Debt
Net Debt/EBITDA (in Dollars)(2)

Trs Lagoas
Jacare
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.
(2) For covenants purposes, the Net Debt/EBITDA ratio is calculated in Dollars.

Fibrias 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

Fibrias Commercial Strategy

Sales Mix by End Use - Fibria
End Use - 1Q15

Region - 1Q15
N.
America
17%

Europe
46%

Highlights

Printing &
Writing
35%

Tissue
48%

Asia
26%
Specialties
17%

Other
11%

Sales Mix by Region - Fibria

11% 9% 11% 10% 10% 10% 11% 10% 9% 10% 8% 8% 8% 9% 9% 10% 10% 11%
22% 25%

14% 20%

37%

46% 41%

30%

46%

20%

20% 23% 25% 26% 21% 26% 26% 26% 27% 25% 23% 26%
31% 28%

35% 44%

43% 41% 36%

42%

43% 35% 36%

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

100% certified pulp (FSC and PEFC/Cerflor)

39% 40%
46% 42%
46%

29% 29% 24%

26% 26% 30% 22% 28% 31% 30%
26% 27%
19% 22%
18%
17%

4Q101Q112Q113Q114Q111Q122Q123Q124Q121Q132Q133Q134Q131Q142Q143Q144Q141Q15
North America

Europe

Asia

Other

Pulp Supply Agreement: 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 Paranagu (FOB Paranagu)

Sales destination: Globally, except for South America

Operational startup: Mar/2016

Agreement benefits:

Logistics and commercial

structure synergies;

Logistics and commercial

optimization and synergies;

Ensure sales volumes;

Support customers growth and

enhance customers needs;

Ensure pulp market access with

Klabin brand.

Potential development of new

customers.

Mutual value creation, with better servicing for both Companies customers base
8

Shareholder Structure and Corporate Governance

Votorantim
Industrial S.A. (1)

29.42%

BNDES
Participaes (1)

30.38%

Free
Float (2)

General
Meeting

40.20%
Fiscal
Council
20% independent
members
Role of CEO and
chairman is split

Board of
Directors

Listed on Novo Mercado, highest level at BM&FBovespa:

Only 1 class of shares 100% voting rights
100% tag along rights (Brazilian corporate law establishes 80%)

Finance
Committee

Statutory
Audit
Committee

Personnel and
Remuneration
Committee

Sustainability
Committee

Innovation
Committee

30%
independent
members

100%
independent
members

50% independent
members

45% independent
members

Policies approved by the Board of Directors:

Indebtedness and Liquidity

Market Risk Management

Risk Management

Board of Directors with minimum 20% independent members

Corporate Governance

Financial Statements in International Standards IFRS

Related Parties Transactions

Adoption of Arbitration Chamber

Anti-Corruption

SEC Registered ADR Level III program

(1) Controlling group
(2) Free Float 40.14% + Treasury 0.06%

Information Disclosure
Securities Trading
Antitrust
Genetically Modified Eucalyptus

Pulp and Paper Market

10

In 2013, we stressed the difference between the expected scenario

and the realized one...

BHKP CAPACITY CHANGES

Expected scenario for 2013 in Nov2012
Eldorado

1,275

Suzano Maranho

Realized scenario in 2013

Eldorado

320

1,270

UPM Fray Bentos

100

DELAYED
Montes del Plata
Sappi Cloquet
Jari

555
-155

Sappi Cloquet

-410

Jari

Net
BEKP demand growth*

1,585
1,080

*Source: PPPC Outlook for Eucalyptus Market Pulp November 2012

-155
-410

Cellulose du Maroc

-140

Sodra Tofte

-60

Net
BEKP demand growth*

Unexpected
Closures
605
1,310

*Source: PPPC Outlook for Eucalyptus Market Pulp September 2014

11

As a result we had better prices than expected

BHKP Delivered to Europe (USD/t)

820

814

810
800
790

795
788

791
784

780

772
770

767

765

770

772

4Q13

Annual 2013

760

750
740
1Q13

2Q13

3Q13

Consultants average for 2013

Realized PIX/FOEX price

Consultants: Hawkins Wright, RISI and Brian McClay (published in the end 2012 for 2013 prices)

12

The better than expected scenario happened again last year...

BHKP CAPACITY CHANGES

Expected scenario for 2014 in Dec13

Realized scenario in 2014

230

Eldorado

1,275

Suzano Maranho
Montes del Plata

Suzano Maranho

830

1,100

Montes del Plata

560

Oji Nantong*

230

Eldorado

550

Oji Nantong*

235

UPM

100

Sappi Cloquet

-115

Sappi Cloquet

-70

Sodra Tofte

-120

Sodra Tofte

-120

APRIL Rizhao

2,660

Net
BEKP demand growth**

1,380

*Partly integrated to existing PM

**Source: PPPC Outlook for Eucalyptus Market Pulp November 2013

-65

Old Town

-85

Ence Huelva

-105

More unexpected
mill closures

Net

1,770

BEKP demand growth

1,734

*Approved license only for 500,000 t/y

13

 and also better prices than initially projected

BHKP Delivered to Europe (USD/t)

800

782
780

768
752

760
740

737

746
729

734
733

720

718
700

696
680
660
640
1Q14

2Q14

3Q14

Consultants average for 2014

4Q14

Annual 2014

Realized PIX/FOEX price

Consultants: Hawkins Wright, RISI and Brian McClay (published in the end 2013 for 2014 prices)

14

Then, what about 2015?

BHKP CAPACITY CHANGES

Expected scenario for 2015 in Dec14
Suzano Maranho

400
750

Montes del Plata

265

Oji Nantong

750

CMPC Guaiba II
200

Eldorado
Portucel Cacia

30

Old Town (Expera)

85

Sappi Cloquet
April Rizhao

Ence Huelva
Possible closures*
Net

115
-65
-315
-400 to -800

Realized scenario in 2015

1,415 to 1,815

BEKP demand growth**

1005

*Based on annual closures average (400,000 to 800,000 t/yr)

**Source: PPPC Outlook for Eucalyptus Market Pulp September 2014

15

Global Market BEKP Demand

Shipments of Eucalyptus Pulp
2014 vs. 2013(1)

4M2015 vs. 4M2014(2)

11%
1,734 kt

13%
20%
6%
5%

717 kt

386 kt

675 kt

13%

27%

537 kt

17%

92 kt

Total

(1)

North
America

Western
Europe

China

Others

Source: PPPC World 20 December/2014

January/2015

Total
(2)

14%

5%

86 kt

106 kt

291 kt

192 kt

North
America

Western
Europe

China

Others

Source: PPPC World 20 April/2015

Paper Capacity increase in China

2014

2015

Total

FORECAST

REALIZED

PREVIOUS
FORECAST

LATEST
FORECAST

PREVIOUS

LATEST

Woodfree

256

256

760

760

1,016

1,016

Tissue

1,390

1,278

727

1,365

2,117

2,643

Cartonboard

2,100

1,326

380

730

2,480

2,056

Total

3,746

2,860

1,867

2,855

5,613

5,715

Source: Fibria and Independent Consultants

16

Commodities Differentiation
China GDP breakdown
8%

4%

4%

3%

3%

2%

2%

2%

2%

2%

2%

44%

47%

48%

48%

48%

48%

48%

48%

47%

47%

46%

49%

49%

48%

49%

49%

50%

50%

50%

51%

51%

52%

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
248
204
190
166
153
124
120

100
2008A

2009A

2010A

2011A

2012A

2013A

2014A

2015E

2016E

2017E

2018E

Source: Ita Macroeconomic Department and PPPC May/15

17

Technical Age and Scale in the Market Pulp Industry

Further closures are expected due to lack of adequate investments in the industry
Hardwood (BHKP) Market Pulp
3.000

Softwood (BSKP) Market Pulp

PM Capacity, 1000 t/a

3.000

Weighted average
technical age 12.3 years

PM Capacity, 1000 t/a

Weighted average
technical age 21 years

STRONG

2.500

STRONG

2.500
Aracruz

2.000

1.500

2.000

Weighted average
capacity 1,277,000 t/a

Trs Lagoas

1.500

Jacare

1.000

Veracel

1.000
Weighted average
capacity 527,000 t/a

Ence
Huelva

500

500

Old
Town

30

WEAK

20

10

0
30

WEAK

25

Technical Age, years

North American Pulp Mills

Other Pulp Mills

Closures

20
15
10
Technical Age, years

Grade Switch

On & Off

More than 7.7 million tons of capacity above 25 years and with annual capacity below 500,000 t/y.

18

Capacity closures DO happen

Closures of Hardwood Capacity Worldwide

(000 ton)
-85

-105

-540

-445

-500

-750
-910
-1,085
-1,180
-1,260
2006

2007

2008

2009

2010

2011

2012

2013

2014

2015-2017 E

(1)

Source: PPPC and Fibria

(1)

As of April 2015

19

Among the industrys lowest cash cost producers

Total Cash Cost of BHKP delivered to Europe (US$/t)
Capacity
(k tons):

1,925

1,610

1,030

3,785

4,695

2,015

13,930

5,300

= 28,990

1Q15 net price:

US$ 560/t

70

W/K

87

Interest

105
44

453

64

72
419
351

China

Capex

27

USA

Canada

312

Indonesia

Cash Cost (US$/t)

286

Chile/Uruguay

Income Tax
SG&A
55

329

Iberia

207

199

Brazil

Fibria

Delivery (US$/t)

Source: Hawkins Wright (Outlook for Market Pulp, April 2015) | Fibrias 1Q15 considering a FX of R$/US$2.8737. | Brazil 2014 considering FX of R$/US$3.05.
Gray bar includes cash expenses as Interest, CAPEX, SG&A and Taxes (Source: RISI and Fibria).

20

Gross capacity addition should not be counted as the only factor

influencing pulp price volatility.(1)
List Price bottoming at US$650/t in 2011 and US$724/t in 2014
APP South
Sumatra(2)

1.000

Horizonte II

900

1,6

Rizhao

Maranho

Trs
Lagoas

700
APP
Hainan

600
500

400

Eldorado

Santa F

1,4

Montes
del Plata Guaba II

Fray
Bentos
Mucuri
Veracel Nueva Aldea

Valdivia

1,8

1,2

Klabin

1,0
Chenming
Zhanjiang

Kerinci
PL3

Capacity (000 ton)

BHKP prices - CIF Europe (US$/ton)

800

2,0

0,8

APP Guangxi

300

0,6

Oji
Nantong

200

0,4

100

0,2

0,0
2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

(1) Source: Hawkins Wright , Poyry and Fibria Analysis. Pulp price estimates according to Hawkins Wright (Apr/15), Brian McClay (May/15) and RISI (Dec/14)
(2) Partially integrated production

21

Lowest volatility among commodities

100 = January 1st, 2012
180

Commodities Historical Volatility (US$)(1)

170

164

160
150
140
130
120

120

110
100
90
80

77

70
60
53

60
50

44

40

Iron Ore

Soy Bean

Sugar

BHKP Price (FOEX Europe)

May-15

Apr-15

Feb-15
Mar-15

Jan-15

Dec-14

Nov-14

Oct-14

Sep-14

Jul-14

Aug-14

Jun-14

May-14

Apr-14

Jan-14

Feb-14
Mar-14

Dec-13

Nov-13

Oct-13

Sep-13

Aug-13

Jul-13

Jun-13

Apr-13

Crude Oil

May-13

Feb-13
Mar-13

Jan-13

Dec-12

Oct-12

Nov-12

Sep-12

Aug-12

Jul-12

Jun-12

May-12

Apr-12

Feb-12
Mar-12

Jan-12

30

Exchange Rate (USD - BRL)

Source: Bloomberg - May, 25th 2015

Low volatility of hardwood pulp price, even though new capacities have
come on stream in the period
22

Brazilian macroeconomic data evolution

45

Trade Balance - R$ billion

46

34

40
25

25
11

11

15

13

25

30
20

19

13

10
-3

-7

-6

-7

-1

-1

-4

-5

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

(1)

(1) From Jan/15 to Apr/15.

Balance of Payments - R$ billion

87

59
47

49

31
19
3
-8

-8

-8

1997

1998

1999

-2
2000

11

3
-6

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

23

Financial and Operational Highlights

24

FX and Pulp Price explain 80% of Fibrias EBITDA Margin

Each 10% depreciation of the Real increases EBITDA by approx. R$770 million
3.07(3)
Exchange Rate
Average (R$/US$)

Fibria net pulp price

(US$/t)

Fibria net pulp price

(R$/t)
Marginal producer cost
(US$/t)(4)

2.00

1.76

1.67

670

639

2.29

610

572

564

Market
Consensus

1,731
1,179
912
660

1,067
676

627

29%

34%

2,526
EBITDA (R$ million)

581

2.10

456

40%
EBITDA Margin

1.95

1,133
657

36%

1,964

2,253

2011

2012

1,281

1,310

680

676

40%

39%

2,796

2,791

2013

2014

1,522

2009 (1)

2010 (1)

2015

(1) Excludes Conpacel | (2) 2014 year end market consensus | (3) According to Focus Report (Brazilian Central Bank May. 25th, 2015) | (4) According to Poyry full cost estimate - includes
Manufacturing + Delivered costs to Rotterdam + Depreciation + ROCE of 9%

25

No exposure to eletricity shortage risks, in spite of which the

company has benefited from the sale of its surplus energy
Cash Production Cost (R$/t)
572

549
19

1Q14

Wood

10

( 11 )

(7)

(3)

Materials and
Services

Energy
Consumption

Utilities

Others

15

FX

1Q15

+ 4.2%
Management initiatives seeking to maintain the cash cost below inflation.
(Utilities: 1Q15: R$25/t I 4Q14: R$37/t I 1Q14: R$18/t)

Cash Production Cost Total and Ex-Downtime (R$/t)

524 549

1Q14

548 572
472 472

4Q14

Cash Cost ex-Downtime

1Q15
Cash Cost

26

Cash Production Cost saw a annual increase of 3.7% over the past
6 years
Fibria Cash Production Cost (1) (R$/ton)

CAGR: + 3.7%

505
432

2009 (2)

448

2010 (2)

471

473

2011

2012

2013

519

Consistently
controlling the
production
cash cost at a
level below
the inflation
pace.

2014

(1) Constant Currency (2) Excludes Conpacel

27

Net Results (R$ million) 1Q15

1,007
FX Debt

MtM
hedge
swap

ZCC

(1,685)
(123)

(44)

(22)

(566)

Others (1)

Net Income
(Loss)

179
(85)

deffered
current

(448)
Adjusted
EBITDA

(1)

FX Debt /

MtM

MtM Debt
Hedge

Operational
Hedge

Swap/ZCC
settlements

Net
Interest

Deprec.,
amortiz. and
depletion

643
Income
Taxes

Other FX and
monetary
variations

Includes non-recurring expenses/non-cash and other financial income/expenses.

28

Free Cash Flow (1) 1Q15 LTM (R$ million)

3,119

1,001

(1,645)

Adjusted EBITDA

Capex

(322)

( 149 )

(34)

32

Interest
(paid/received)

Working Capital

Taxes

Others

Free Cash Flow

FCF/ton: US$76

(1) Does not include non-recurring items.

29

Indebtdeness
Net Debt (Million)

Gross Debt and Interest Expenses (Million)

2.9

2.7

2.4
2.4

8,991

7,549
3,080

2,842

Mar/14

8,445

44

35

Mar/15

9,352

8,327
3,732

2,803

Dec/14
R$

3,135

Mar/14

- 22%
2,915

Dec/14
R$

US$

Mar/15

US$

Average Tenor (months) and Cost of Debt* in US$ (% p.a.)

Debt Amortization Schedule (US$ Million)

657

- 40%

58

2.3

2.4

6,970

Interest (US$)

Net Debt/EBITDA (US$)

Net Debt/EBITDA (R$)

623

600

3.7
3.4

3.5

438

(revolver) 545

363

339
241

84
2016

Pre-payment

54

Dec/14

Mar/15

47

205

(cash) 113

Liquidity 2015

55

2017

2018

BNDES

2019
ECN

2020
ACC/ACE

2021
Voto IV

19

2022

2023

Bond

2024

Mar/14

(*) Considering the portion of debt in reais fully adjusted by the market swap curves at the end
of each period.

30

Capital Structure: Fibria has achieved the lowest leverage ratio among
its Latin American peers
Net Debt/EBITDA (x)(1)

14.8
13.2
11.7

4.8
3.6

4.5

4.5

3.7

3.6
3.1

2.9

3.1

2.4
1Q12

2Q12

3Q12

Fibria

4Q12
Suzano

1Q13

2Q13
Klabin

3Q13

4Q13

1Q14

CMPC

8.9

4.1
2.7
2.4

2.3

3.23.4
3.0
2.7

7.7

4.2
3.9
3.6
2.9

1.7

1.7
4Q11

11.1

2Q14

3Q14

Arauco

4Q14

1T15

Eldorado

Fibria

Arauco

CMPC

Klabin

Suzano

S&P

BBB-/Stable

BBB-/Stable

BBB-/Negative

BBB-/Negative

BB/Stable

Moodys

Ba1/Positive

Baa3/Stable

Baa3/Negative

Ba2/Stable

Fitch

BBB-/Stable

BBB/Stable

BBB+/Stable

BBB-/Stable

BB/Stable

(1)

Fibrias historical data in BRL.

31

A consistent and disciplined approach focused on reducing debt

and its cost
Debt (US$ million) x Leverage (US$)

Interest (US$ million) x Cost of Debt (US$)

7.5
8.6

4.1

6.3

4.2

3.3

2.4

2.6

2.3

473

6.3

5.9
414

5.5
408

5.2

4.6

3.4

3.5*

200

178

2014

LTM

350
268

2.9 2.8

2009

2010

2011

2012

Gross Debt

2013

2014

Mar/15

2009

2010

2011

2012

2013

Net Debt

Free Cash Flow

Increase

Interest
Reduction

Cost of Debt
Reduction

This dynamics
creates a virtuous
cycle

(*) Considering the portion of debt in reais fully adjusted by the market swap curves of Mar. 31, 2015.

32

New issuance better priced than Investment Grade issuers

Fibria 2024
Principal:

Highlights
US$ 600 million

Issuance Date:

May/2014

Coupon:

5.25% a.a.

Bookbuilding:

- SEC registered;
- IG Documentation;

- Stretch Debt maturities;

11.5x

Spread over T10Y:

- Fibria 2021 early redemption of US$430 million (78%

of the total).

275.0 bps

Rating

Maturity

Volume

T-Spread

Coupon

Fibria

Ba1 / BBB- / BBB-

2024

US$ 600 MM

275 bps

5.25%

Braskem

Baa3/BBB-/BBB-

2024

US$ 500 MM

340 bps

6.45%

Petrobras

Ba2/BBB-/BBB-

2024

US$ 2,5 bi

350 bps

6.28%

BNDES

Baa2/BBB

2024

US$ 500 MM

362 bps

6.32%

Klabin

BBB-/BBB-

2024

US$ 500 MM

269 bps

5.25%

Baa3/BBB/BBB

2029

US$ 500 MM

263 bps

5.25%

Odebrecht
Data as of Aug 07, 2014:

33

and performing better than Investment Grade issuers

Secondary G-Spread to Maturity (bps) (1)

463
360
237

228

246

Globopar 22 Brasil Foods 24 Embraer 23

265

279

288

Fibria 24

Votorantim 24

Vale 22

404

381

410

419

314

Klabin 24

Samarco 24

Gerdau 24

Braskem 24

Petrobras 24 Odebrecht 25 Eletrobras 21

LatAm Investment Grade Loans Spread over Libor (bps) (1)

225
160

140

140

143

150

COPEC

Ecopetrol

Raizen

Fibria

Colbun

Braskem

4 years

5 years

4 years

5 years

6 years

5 years

175

113

Avg. Term

(1)

As of April 2015

Molymet

TGI (O&G)

5 years

5 years

34

Fibria has a low correlation with Brazil

G-Spread (bps) (1)

Bonds Correlation (1)

350

0.9
0.8
0.7

300

0.6

250

0.3

200

150

0.0
100

FIBRBZ '24 vs.

PETBRA '24

Brazil 2025

(1)

CDS Brazil 10y

Fibria 2024

FIBRBZ '24 vs.

BRAZIL '25

Correlation Since May 2014

FIBRBZ '24 vs. CDS

Brazil

Correlation Since January 2015

Source: Bloomberg as of May, 2015

35

Fibria has the simplest and most transparent call in the industry

Negative
Pulp supply

Neutral

Positive

Tissue

China

Closures/conversions
Inefficient capacities in China
Demand
Fiber and grade substitution

Pulp price
Brazil GDP

Energy crisis
FX
Capex inflation

Tax

Corporate Governance

Cost inflation
Rating

36

Final Remarks
37

Fibria is seeking value creation for its shareholders with capital discipline

PULP

INDUSTRY

- Growth with discipline

CONSOLIDATION ?

- Best portfolio of projects

Potential
Growth
Prospects
BIO-ENERGY

OTHER OPPORTUNITIES

- Complementary to pulp

Portocel

- Ensyn

Land and forest

38

Horizonte 2 Project
39

What is the importance of growth for Fibria?

Competitiveness

Commercial
positioning

Long-term growth
potential

Wider fixed costs dilution

Cost curve position improvement

Greater bargaining power with suppliers

Follow the growth of strategic customers

Developing new customers

Distribution to new geographic markets

Efficiency and competitiveness gains in logistics

Higher quality in customer service

Greater ability to capture new expansion market windows

Strong M&A position

40

Why expand Trs 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 120 MWh

Start-up: 4Q2017
Capacity: 1.75 million tons

7,950

Fibria
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
0

2000

4000

6000

8000

Current Capacity

New Capacity Klabin Agreement

New Capacity

New Capacity Horizonte II Project

Source: Poyry and Fibria Analysis (as of May 2015)

41

Pulp sales destination: Fibria growing where the market grows

32%
42%
19%

23%

45%
25%

4%

10%

H2 sales volume distribution

Current sales volume distribution(1)

(1) Considers 1Q15 last twelve months.

42

Window of opportunity for H2 project in 2017

2015

2016

2017

2018

2019

2020

2021

New capacities (000 t)

2,208

2,150

2,300

2,300

900

2,100

1,700

Confirmed

2,208

2,150

2,050

800

250

1,500

900

2,100

1,700

(600)

(600)

(600)

(600)

(600)

Potential
Closures (000 t)

(600)

(600)

Operating Rate not considering any project entering in 2017/2018 (theoretical scenario)

93.6%
90.0%
2015

88.6%
2016

95.3%

94.0%

93.9%

2019

2020

2021

91.1%

90.0%

90.0%

2019

2020

2021

90.3%
2017

2018

89.5%
2018

Operating Rate considering H2

90.0%

88.6%

89.7%

2015

2016

2017

Source: Fibria assumptions. Confirmed projects considers: Klabin Ortigueira, APP South Sumatra and Metsa nekoski

43

Schedule

May/15

Jun/15

4Q15

4Q17

Investment
approval

Equipment
purchase

Beginning of civil
work

Start-up

44

Forestry base
45

H2 Project will have the forest base ready for the start-up

Forestry base required:

H1:

120,000 ha

H2:

174,000 ha

Total:

294,000 ha

46

Logistics
47

Forestry Logistics
Low average distance from forest to mill

FOREST

MILL

95 km

H1 + H2 consolidated

48

Outbound logistics
Fibria has logistical alternatives on a competitive basis

Pulp flow: From Mill to the Port

International Logistics

Mill

Logistics and
commercial optimization

Greater bargaining
power with suppliers

ALL railroad - meter gauge

ALL railroad - broad gauge
MRS railroad - broad gauge

North-South railroad
Waterway
Highway

Santos
Port

49

Financials
50

Even more competitive cash production cost

BHKP (US$/t)

453

419
351

329

312

286

207

China

USA

Canada

Iberia

Indonesia

Chile/Uruguay

Brazil

173

Fibria 1Q15 LTM

158

Fibria w/ H2

Source: Hawkins Wright (Outlook for Market Pulp, April 2015) - FX considered by the consultant of R$/US$3.05.
H2 cash cost was estimated according to weighted average cost, after mill balance, converted by R$3.05. Includes energy sales.

51

Industrial + forestry expansion capex

Expansion Breakdown
R$ MILLION

Industrial and
logistics

Expansion capex expected curve

R$/T(2)

45%
6,695

3,826

37%

Forestry (includes
forestry equipment)

632

361

Other(1)

379

217

7,706

4,404

Total

Industrial capex breakdown by currency:

BRL - 72%
EUR 26%
USD and Swedish Krona 2%

7%

7%
2015

2016

2017

2018

4%
2019
onwards

(1) Includes chemical plant leasing and investments to increase capacity to 1,850 kt/year.
(2) The calculation considers 1,750 kt/year of capacity.

52

Funding sources: Companys cash generation and financing

instruments

INSTRUMENT

ESTIMATED AVERAGE
MATURITY

BNDES(2)

6.1 years

FDCO

8.5 years

ECAs

6.5 years

Banks

5 years

Bond Market

10 years

Estimated average cost in US$ of

3.0% p.a.(1) and average term of
the new debt of 7.3 years

Total amount of debt financing

and the proportion of each
instrument will depend on the
Companys cash generation
during the construction period
Risk mitigation strategies in case of
BRL appreciation:
- Pre-funding on favorable FX
scenarios

- Cash flow hedging strategy mainly

with Zero Cost Collar

(1) Adjusted by the Market swap curves as of May 14th, 2015. Source: Bloomberg
(2) Considering 50% of TJLP, 25% of SELIC + spread and 25% CRA.

53

Rating agencies understand that the Project will not jeopardize

Fibrias credit metrics

We expect Fibria to continue benefiting from higher operating cash flows which
would allow it to enlarge its Trs Lagoas industrial complex while keeping its debt at
reasonable levels for a low investment-grade rating

Fitchs base case, which assumes that the company builds a new pulp mill (Trs
Lagoas II) starting in 2015 and uses net pulp prices of between USD575 and USD675
per ton during the construction period, results in net leverage reaching 3.5x(1). Net
leverage would quickly decline to around 2.5x(1) once the mill becomes operational
in the second half of 2017

(1) According to rating agency methodology

54

Project financials at a glance

UNIT
Pulp production/year(1)

k tons

1,750

Expansion capex(2)

R$ billion

7.7

Sustaining capex(3)

R$/t

193

Cash cost(4)

R$/t

341

Energy surplus

MWh

120

(1) Creep capacity will increase production to 1,850 kt/year

(2) Includes chemical leasing and investments in order to increase capacity to 1,850 kt/year.
(3) Estimated sustaining capex in perpetuity considering capacity of 1,850 kt/year.
(4) Estimated weighted average cost, after mill balance. Includes energy sales.

55

Final Remarks

Economies of scale

Synergies with current operations

Wood availability and low distance from forest to mill

Fibrias total energy surplus to be increased by 120 MWh

Cash cost competitiveness

Meet customers demand growth

Attractive returns even in scenarios with appreciated BRL

Solid financial profile

56