São Paulo, July 25, 2018 – Fibria, a Brazilian company and the world’s leading producer of eucalyptus pulp derived from planted forests, has set new operational records in the second quarter of the year, with EBITDA (earnings before interest, taxes, depreciation and amortization) of R$2.5 billion and EBITDA margin of 58%, driven by higher pulp prices in Brazilian real, higher sales volume and better production costs, despite the impact caused by the truck drivers’ strike in May. The free cash flow of R$1.7 billion, excluding non-recurring investments and before dividend payments, was also a record for a single quarter.

These results, combined with solid financial health, enabled Fibria to return, in the second quarter of 2018, to the level of leverage it had before the start of the investment cycle relating to the construction of the second production line at Três Lagoas, Mato Grosso do Sul, with the ratio of net debt to EBITDA in U.S. dollar reaching 1.58 – the lowest since the third quarter of 2015, when investments in the expansion project were still incipient. The second quarter of 2018 also marked the successful conclusion of the learning curve at the new plant in Mato Grosso do Sul, within the nine months initially scheduled in the project.

“We have completed the cycle. We announced the expansion at Três Lagoas in May 2015 and, in August 2017, we started operating the new line – ahead of time and within the budget – while retaining the investment grade throughout the period. Now, in the second quarter of this year, we concluded the learning curve of the plant and returned, within just 10 months of its startup, to the level of leverage we had three years ago. All this shows the quality of the investment decision, the high degree of excellence in project execution and the structural competitiveness of the company. We have attained a high level of operational stability at the new production line, which translates into our capacity to achieve even better economic performance,” said Marcelo Castelli, CEO of Fibria.

In the pulp market, the second quarter of the year was marked by the continuation of positive fundamentals. Demand remained solid in key markets, contributing to the 11% growth in sales volume compared to 1Q18, driven by higher sales to Asia and North America. Compared to 2Q17, the 15% increase in sales volume was due to the operational startup of the second plant at Três Lagoas, backed by strong demand, especially in Asia. In the second quarter of 2018, Fibria’s sales volume reached 1.768 million tons.

On the supply side, apart from the wood availability problems in the initial months of the year, other unforeseen events continued to pressure inventories, notably the truck drivers’ strike in May, which restricted the production capacity of plants in the sector throughout Brazil, resulting in an estimated reduction of around 250,000 tons in hardwood pulp supply. In the second quarter, Fibria’s pulp production volume was 1.6 million tons, remaining stable in relation to the first quarter, mainly due to the impact of the truck drivers’ strike, which caused a decline of 67,000 tons in production.

Fibria’s cash cost of production in the second quarter came to R$668/ton, down 6% from the first quarter, mainly due to the lower impact of scheduled maintenance shutdowns and the better result from energy sales, the effects of which were partially neutralized by the truck drivers’ strike, whose impact was R$31/ton, and by the appreciation of the U.S. dollar against the Brazilian real. Excluding the effects of scheduled plant shutdowns and the truck drivers’ strike, cash cost of production in the second quarter was R$598/ton, lower than in the previous quarter, already excluding scheduled shutdowns from that period, and also lower than the cash cost of production in the same quarter in 2017.

Since Fibria is an exporter and since around 60% of its debt is in U.S. dollar, any depreciation of the Brazilian real favors the Company’s financial condition by increasing its EBITDA and free cash flow. On the other hand, it also has a non-cash accounting effect, of mainly increasing the balance of debt in dollar when translated into Brazilian real. As a result of this effect, which does not arise during periods of currency stability, financial result was negative at R$2.239 billion in the second quarter, largely due to the 16% depreciation of the Brazilian real, which impacts debt and the hedge result. Due to the negative financial result, Fibria recorded an accounting net loss of R$210 million in the second quarter. In the first six months of the year, the company recorded net income of R$405 million.

“This quarter, we set records for EBITDA and free cash flow, while leverage in U.S. dollar reached 1.58 times. Fibria’s capacity to maintain the course of deleveraging is significant when we consider the contribution of new sales volumes from the second production line at Três Lagoas and considering that pulp prices and the exchange rate in the second half of last year were lower than they are now,” said Guilherme Cavalcanti, the Chief Financial and Investor Relations Officer.

In accordance with the Material Fact notice dated March 16, the controlling shareholders of Fibria – Votorantim S/A and Banco Nacional de Desenvolvimento Econômico e Social Participações S/A (BNDESPar) – entered into an agreement with Suzano Holding S/A and other controlling shareholders of Suzano Papel e Celulose S/A to combine the shareholdings of Fibria and Suzano through an ownership restructuring operation. Until the date of consummation of the transaction, which depends on approval by regulatory authorities in Brazil and abroad, Fibria and Suzano will continue to operate independently.


About Fibria

The world leader in eucalyptus pulp production, Fibria strives to meet, in a sustainable manner, the growing global demand for products derived from planted forests. The company, whose annual pulp production capacity is 7.25 million tons, has industrial units in Aracruz (Espírito Santo), Jacareí (São Paulo) and Três Lagoas (Mato Grosso do Sul), as well as in Eunápolis (Bahia), where it operates Veracel in a joint venture with Stora Enso. Fibria has 1,092,000 hectares of forests, which include 656,000 hectares of planted forests, 374,000 hectares earmarked for environmental preservation and conservation, and 61,000 hectares destined for other uses. The pulp produced by Fibria is exported to more than 35 countries and is the raw material for educational, health, hygiene and cleaning products. Learn more at


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Fibria Media Relations 

Andrea Donadio

(11) 3185-9934

Marcelo Mota

(11) 3185-9939