Santander Pulp

8/16/2019 Santander Pulp

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Santander Pulp & Paper DayMay 25th, 2016



2

The information contained in this presentation may include statements whichconstitute 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.

Disclaimer



3

Pulp and Paper Market2Financial and Operational Highlights3

Agenda

Company Overview

1

Expansion Project – Horizonte 24Dividends5Cost reduction initiatives andindustry statistics6



4

Company Overview



5

A Winning Player

Port Terminal Pulp Unit

Três Lagoas

Santos

AracruzPortocel

Caravelas

BelmonteVeracel

Jacareí

Superior Asset Combination Main Figures – 1Q16 LTM

Pulp capacity million tons 5.300

Net revenues US$ billion 2.930

Total Forest Base(1) thousand hectares 969

Planted area(1) thousand hectares 568

Net Debt US$ billion 2.897

Net Debt/EBITDA (in Dollars)(2) X 1.86

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, 2015.(2) For covenants purposes, the Net Debt/EBITDA ratio is calculated in Dollars.



6

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

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)

Sales Mix by End Use - Fibria Highlights

Fibria’s Commercial Strategy

Net Revenues by Region - Fibria

Region - 1Q16 End Use - 1Q16

42% 37%43% 43%

35% 36%46% 42% 39% 40%

47% 42% 42% 42% 46%

26%30% 22%

29%31% 31%

19% 23% 27% 27% 17% 24% 25% 29% 17%

22% 25% 26%21%

25% 26% 26% 27% 24% 23% 26% 26% 25% 20%25%

10% 9% 10% 8% 9% 8% 10% 9% 10% 10% 10% 9% 8% 9% 12%

3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16

Europe North America Asia Other

48%38%

14%

Printing &Writing

Specialties

TissueEurope46%

N.America

17%

Asia25%

LatAm12%



8

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 byFibria at the Port of Paranaguá (FOB Paranaguá)

► Sales destination: Globally, except for South America

► Operational startup: Mar/2016

► Agreement benefits:

Puma Project

Mutual value creation, with better servicing for both Companies customer’s base

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.



9Pulp and Paper Market



The “better than expected scenario” has become a reality again in

2015…

BHKP CAPACITY CHANGES

EXPECTED SCENARIO FOR 2015 IN DEC’14 REALIZED SCENARIO IN 2015

1,095

-315

-65

115

85

30

200

750

265

750

400

BEKP demand growth**

Net

Possible closures*

Ence Huelva

April Rizhao

Sappi Cloquet

Old Town (Expera)

Portucel Cacia

Eldorado

CMPC Guaiba II

Oji Nantong

Montes del Plata

Suzano Maranhão

-400 to -800

1,415 to 1,815

*Based on annual closures average (400,000 to 800,000 t/yr)**Source: PPPC Outlook for Eucalyptus Market Pulp December 2014

1,232

1,450

-400

-315

-190

115

40

40

30

200

500

265

750

400


Net

Unexpected Downtimes

Ence Huelva

April Rizhao

Sappi Cloquet

Ence Navia

Old Town (Expera)

Portucel Cacia

Eldorado

CMPC Guaiba II

Oji Nantong

Montes del Plata

Suzano Maranhão

Indonesia, China,Uruguay and Brazil

**Source: PPPC Market Pulp World 20



… and so has been the price scenario

BHKP Delivered to Europe (USD/t)

735

721

709

738

726

750

781

804 802

784

1Q15 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)



Better worldwide macroeconomics are the key drivers… But the

special focus is on Europe

Real GDP % Annual Growth

Source: International Monetary Fund, World Economic Outlook Database, January 2016

3.4

-0.8

2.2

7.7

3.3

-0,3

1.5

7.7

3.4

0.9

2.4

7.3

3.1

1.5

2.4

6.9

3.5

1.7

2.4

6.3

World Euro Area USA China

2012 2013 2014 2015 2016



But the special focus is on Europe

Hardwood and Eucalyptus Shipments (000 t and % annual growth)

Source: PPPC World 20

-0.3%

-0.8%

3.3%

3.8%

-0.8% -0.6%

6.0%

5.0%

-200

0

200

400

2012 2013 2014 2015

BHKP BEKP



So, what can we expect for 2016?

BHKP CAPACITY CHANGES

EXPECTED SCENARIO FOR 2016 IN NOV’15 FIBRIA’S EXPECTED SCENARIO FOR 2016

930

-120

-55

-90

-40

30

660

800


Net

Possible closures*

APRIL Kerinci

Verso Wickliffe

Woodland

Old Town (Expera)

Altri Celbi

Klabin

CMPC Guaiba II

-400 to -800

385 to 785

1,200

*Based on annual closures average (400,000 to 800,000 t/yr)**Source: PPPC Outlook for Eucalyptus Market Pulp May 2015 (930kt) andFibria’s estimates

1,200

1,165

-200

-120

-55

-90

-40

180

30

660

800


Net

Possible closures*

APRIL Kerinci

Verso Wickliffe

Woodland

Old Town (Expera)

APP South Sumatra

Altri Celbi

Klabin

CMPC Guaiba II

Positive Supply/Demand Balance!



Shipments of Eucalyptus Pulp

(1) Source: PPPC World 20 – January/2015

Global Market BEKP Demand

Paper Capacity increase in China

2014 2015 2016

FORECAST REALIZEDPREVIOUSFORECAST

LATESTFORECAST

LATESTFORECAST

Woodfree 256 256 760 980 1,000

Tissue 1,390 1,278 1,365 965 568

Cartonboard 2,100 1,326 730 900 630

Total 3,746 2,860 2,855 2,845 2,198

Source: Fibria and Independent Consultants

3M16 vs. 3MQ15(2)

(2) Source: PPPC Global 100 – March/2016

2M16 vs. 2M15(1)

100kt

-57kt

32kt

153kt

-28kt

285kt

7kt

73kt

202kt

3kt

Total NorthAmerica

WesternEurope

China Others

BHKP BEKP

1%

6%

-7% 2%1%

4%

7%13%

1% 0.2%

128kt

40kt

84kt

-7kt 11kt

216kt

64kt

114kt

12kt 26kt

Total NorthAmerica

WesternEurope

China Others

BHKP BEKP

(1) Source: PPPC Global 100 – February/2016

3%

7%

8%26%

6%

10%

-1%1% 1% 4%

6%



Technical Age and Scale in the Pulp IndustryFurther closures are expected due to lack of adequate investments in the industry…

Hardwood (BHKP) Producers – Integrated and MarketPulp Mills

Softwood (BSKP) Producers – Integrated and MarketPulp Mills

STRONG

Weighted average

technical age 12.3 years

Weighted average

capacity 1,350,000 t/a

Aracruz

Três Lago as

Veracel

Jacareí

WEAK

STRONGWeighted average

technical age 21 years

Weighted average

capacity 534,000 t/a

North American Pulp Mills Other Pulp Mills

WEAK

More than 6.6 million tons of capacity above 25 years and with annual capacity below 500,000 t/y.

PM Capacity, 1000 t/a

0

500

1000

1500

2000

051015202530

Technical age, years

PM Capacity, 1000 t/a

0

100

200

300

400

500

600

700

800

900

1000

051015202530

Technical age, years



Source: PPPC and Fibria

Closures of Hardwood Capacity Worldwide

(000 ton)

Capacity closures DO happen

-910

-85

-1,260

-1,180

-540-500

-105

-1,085

-445

-315

-580

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016-2017 E (1)

(1) As of January 2016 | 2016: -40kt Old Town (USA), -90kt Woodland (USA), -55kt Verso Wickliffe (USA), -120 April Kerinci (Indonesia) | 2017: -275kt Arauco Valdivia (Chile)



Even more competitive cash production cost w/ H2BHKP (US$/t)

Source: Hawkins Wright (Price Forecast April 2016) and Fibria’s 1Q16 Earnings Release - FX considered by the consultant at R$/US$3.54. H2 cash cost wasestimated according to weighted average cost, after mill balance, converted at R$/US$3.54. Includes energy sales.

460 428375 347

299 295217 184 152

87

55100

2549 60

5851

547

483 475

372

348 355

275

404

10016

19414

USA China Canada Iberia Indonesia Chile/Uruguay Brazil Fibria 1Q16 LTM Fibria w/ H2 -2018

Cash Cost (US$/t) Delivery CIF Europe

BHKP (US$/t)

InterestCapex

SG&A

Income Tax

1,130 2,075 1,095 2,290 3,420 4,915 15,275 Total: 30,200BHKP

capacity(000’ t)

Working Capital



Gross capacity addition should not be counted as the only factorinfluencing pulp price volatility….(1)

List Price bottoming at US$650/t in 2011 and US$724/t in 2014

C a p a c i t y ( 0 0 0 t o n )

0,0

0,2

0,4

0,6

0,8

1,0

1,2

1,4

1,6

1,8

2,0

0

100

200

300

400

500

600

700

800

900

1.000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Valdivia

APP

Hainan

Veracel Nueva Aldea

Santa Fé

Mucuri

Fray

Bentos

Kerinci

PL3

Três

Lagoas

Rizhao

APP Guangxi

Chenming

Zhanjiang

Eldorado

Montes

del Plata

Maranhão

Guaíba II

APP South

Sumatra(2)

Klabin

Oji

Nantong

Horizonte II

B H K P p r i c e s - C I F E u r o p e

( U S $ / t o n )

(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.



In the last 15 years, pulp volatility has been just 8%...why?

► 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 – May 10th, 2016

0

40

80

120

160

D e c - 9 9

M a y - 0 0

O c t - 0 0

M a r - 0 1

A u g - 0 1

J a n - 0 2

J u n - 0 2

N o v - 0 2

A p r - 0 3

S e p - 0 3

F e b - 0 4

J u l - 0 4

D e c - 0 4

M a y - 0 5

O c t - 0 5

M a r - 0 6

A u g - 0 6

J a n - 0 7

J u n - 0 7

N o v - 0 7

A p r - 0 8

S e p - 0 8

F e b - 0 9

J u l - 0 9

D e c - 0 9

M a y - 1 0

O c t - 1 0

M a r - 1 1

A u g - 1 1

J a n - 1 2

J u n - 1 2

N o v - 1 2

A p r - 1 3

S e p - 1 3

F e b - 1 4

J u l - 1 4

D e c - 1 4

M a y - 1 5

O c t - 1 5

M a r - 1 6

BHKP - FOEX Europe (base 100) CPI (base 100)



Lowest volatility among commodities

Source: Bloomberg – May 10th, 2016

Low volatility of hardwood pulp price, even thoughnew capacities have come on stream during the period.

2030405060708090

100110120130140150160170180190200210220

230

J a n - 1 2

M a r - 1 2

M a y - 1 2

J u l - 1 2

S e p - 1 2

N o v - 1 2

J a n - 1 3

M a r - 1 3

M a y - 1 3

J u l - 1 3

S e p - 1 3

N o v - 1 3

J a n - 1 4

M a r - 1 4

M a y - 1 4

J u l - 1 4

S e p - 1 4

N o v - 1 4

J a n - 1 5

M a r - 1 5

M a y - 1 5

J u l - 1 5

S e p - 1 5

N o v - 1 5

J a n - 1 6

M a r - 1 6

M a y - 1 6

Iron Ore Soy Bean Crude Oil Sugar BHKP - FOEX Europe Exchange Rate (R$/US$)

106

186

90

69

4045

100 = January 1, 2012



The only commodity with lower volatility than FX

Historical Volatility of Commodities (US$)

Since January 1, 2009 up to May 10th, 2016

22

37%35% 34%

27% 27%25% 25% 24%

16%

14%

6%

WTI

Crude Oil

Sugar Nickel Copper Iron Ore Soy Ibovespa LME

Metals

Cattle FX BHKP


http://slidepdf.com/reader/full/santander-pulp 23/7823Financial and Operational Highlights

E h 5% d i ti f th R l i EBITDA b d



Each 5% depreciation of the Real increases EBITDA by aroundR$420m and FCF by R$550m

815

1,488

1,173 1,1531,295

1,185

1,560 1,558

2009 2010 2011 2012 2013 2014 2015 1Q16 LTM 2016 (e)

Exchange Rate

Average (R$/US$)

EBITDA Margin

EBITDA (US$ million)

Fibria net pulp price(US$/t)

Fibria net pulp price(R$/t)

2.00 1.76 1.67 1.95 2.16 2.353.33 3.59 3.65(1)

456

670 639 581 610 572582 577 536(2)

29%

40%34% 36%

40% 39%

53% 53%

912 1,179 1,067 1,133 1,311 1,3441,951 2,071 1,956

(1) According to Focus Report (Br azilian Central Bank – May 6th, 2016) I (2) 2016 market consensus



Notional (Total):US$ 1,395 million

Current Zero Cost Collars

2T16 3T16 4T16 1T17 2T17 3T17 4T17 1T18 2T18

ZCC (Notional em USD MM) 50 185 295 216 174 135 190 105 45

Forward* 3,57 3,64 3,73 3,82 3,90 3,98 4,06 4,14 4,21

Put 3,25 3,31 3,36 3,52 3,57 3,64 3,67 3,62 3,64

Call 7,04 6,30 6,62 5,80 6,22 7,17 7,12 5,50 5,73

*média da curva forward da última semana (16-20/Mai/16)



Cash Production Cost (US$/t) – LTM 1Q16

199185 179

160

13

(47)

6 2 66

(6)

(19)

1Q15 Inflation FX Lowerenergy price

Maintenancedowntime

Non recurringwood

Non recurringenergy andchemicals

consumption

Cash cost1Q16 beforemanagement

initiatives

Managementinitiatives

Cash cost 1Q16 Total non-recurring

Recurring cashcost 1Q16

Management initiatives gains partially offset the inflation impact



Fibria Cash Production Cost(1) (US$/ton)

Consistentlycontrolling the

cashproduction

cost

27

Cash Production Cost in dollars saw a decrease over the past 7 years

231

264281

242

234 220

186 182

2009 (2) 2010 (2) 2011 2012 2013 2014 2015 1Q16LTM

(1) Constant Currency (2) Excludes Conpacel



Net Results (US$ million) – 1Q16

322

251

223

72

(24)

(114)

(188)(41)

AdjustedEBITDA

FX Debt MtMHedge

NetInterest

Deprec., amortiz.and

depletion

Taxes Others Net Income∆∆ (1)

(1) Includes other Exchange rate/monetary variations, other financial income/expenses and other operating income/expenses.

Non-recurringeffects

current

deferred



Free Cash Flow(1)

29(1) Before expansion capex

US$ million

EBITDA Margin

Average FX

-256

-77

-7

125

29 77

194

84113

53

329

4

11151

103130

112

317225

158

2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16

34% 33% 28% 30% 37% 37% 41% 39% 39% 41% 42% 41% 35% 35% 45% 50% 50% 56%

1.60 1.63 1.80 1.77 1.96 2.03 2.06 2.00 2.07 2.29 2.27 2.37 2.23 2.27 2.55 2.87 3.07 3.54

54%

3.84

52%

3.90



30

Free Cash Flow(1) – 1Q16 LTM

US$ million

(1) Not considering dividend payments, capexrelated to theHorizonte 2 Project andthe land acquisition in December 2015. Considers 1Q16 averageFX 3.5897.

(2) Not considering dividendpayments.

(3) Includes other financial results.

(4) Considering themarket cap. on March 31, 2015 correspondingto R$23.3 billion (US$7.3 billion).

1,555

863

403

(498)( 78 )

( 93 ) ( 20 ) ( 3 )

(460)

AdjustedEBITDA

Capex(ex-H2 project& land deal)

NetInterest

WorkingCapital

Taxes Others FCF(ex-H2 project& land deal)

CapexH2 &

land deal

FCF



31

ROE and ROIC (R$)

ROE = Adjusted EBIT(1)/ Equity before IAS 41(2) ROIC = Adjusted EBIT(3)/ Invested Capital before IAS 41(2)

(1) Adjusted EBITDA – CAPEX – Net Interest – Taxes

(2) International accounting standards for biological assets.

(3) Adjusted EBITDA – CAPEX – Taxes

3.4%5.7% 6.2%

25.1% 25.3%

2012 2013 2014 2015 1Q16

6.9%9.2% 8.0%

22.8% 23.4%

2012 2013 2014 2015 1Q16

AverageFX

(R$/US$) 1.95 2.16 2.35 3.33 3.591.95

2.16 2.35 3.33 3.59AverageNet Price

(US$)

581 610 561 586 576 581 610 561 586 576

AverageFX

(R$/US$)

AverageNet Price

(US$)

Capital Structure: Fibria has achieved the lowest leverage ratio among



32

Capital Structure: Fibria has achieved the lowest leverage ratio amongits Latin American peers

Net Debt/EBITDA (x)(1)

Fibria Arauco CMPC Klabin Suzano

S&P BBB-/Stable BBB-/Stable BBB-/Stable BBB-/Negative BB+/Stable

Moody’s Ba1/Negative Baa3/Stable Baa3/Stable - Ba2/Positive

Fitch BBB-/Stable BBB/Stable BBB+/Stable BBB-/Stable BB/Positive

(1) Fibria’s historical data in BRL.

1.9

2.3

5.9

3.23.0

4.0

4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16

Fibria Suzano Klabin CMPC Arauco Eldorado



33

One of the best performances among Brazilian corporate issuers(1)

(1) G-spread on May 12th, 2016

336 337 347 353384 394 395

510544

624676

BRFOODS BRAZIL FIBRIA EMBRAER GLOPAR KLABIN SUZANO BRASKEM VALE GERDAU PETROBRAS

di li



34

200

400

600

800

1.000

1.200

1.400

2010 2011 2012 2013 2014 2015

Fibria 2020 Fibria 2021 Fibria 2024

Interest expense, leverage and average cost of debt in US$ Historical G-spread (bps)

Strong credit quality

7.29

4.11 4.25

3.32

2.60

2.41

1.78 1.86

Leverage(x)

6.3 5.95.5

5.24.6

3.4 3.3 3.4

473414 408

350268

200141 139

2009 2010 2011 2012 2013 2014 2015 1Q16

LTM

Interest Expense(US$ million)

Cost of debt (%)

BBB- BBB- Ba1



35

Fibria is able to create value for its shareholders with capital discipline

INDUSTRY

CONSOLIDATION ?

PULP

Growth with discipline

Best portfolio of projects

DIVIDENDS

BIO-ENERGY AND

OTHER OPPORTUNITIES

Complementary to pulp

Portocel

Land and forest

FREE CASH FLOW

WITHOUT JEOPARDIZING CREDITMETRICS



36BACK UP



37Expansion Project – Horizonte 2



38

• 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

Competitiveness

Commercialpositioning

Long-term growthpotential

What is the importance of growth for Fibria?

• Wider fixed costs dilution

• Cost curve position improvement

• Greater bargaining power with suppliers



39

Why expand Três Lagoas?

• Brownfield Project, synergies with currentoperations

• Modern plant, prepared for potentialexpansion

• Availability of wood and low average

distance from forest to mill

• Forest based on the optionality concept andprioritizing lease and partnership models

• Additional energy surplus of 120 MWh

Start-up: 4Q2017

Capacity: 1.85 million tons

ESTIMATED BHKP CAPACITY RANKING 2017 (000T)

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

0 2000 4000 6000 8000

OthersKlabin

Domtar

Pulp Mill Holding

Lwart

Portucel Soporcel

Georgia-Pacific

Resolute

Verso

Nippon Paper

Mondi

Oji

MitsubishiMarubeni

IP

Altri

ENCE

Cenibra

Arauco

Stora Enso

UPM

Eldorado

APP

Suzano

RGE/APRILCMPC

Fibria 8,050

Current Capacity

New Capacity

New Capacity – Klabin Agreement

New Capacity – Horizonte II Project



40

Pulp sales destination: Fibria growing where the market grows

(1) Considers 1Q16 last twelve months. | (2) Includes Klabin’s sales volume

37%

36%

43%

24%

19%24%

8%9%

Total sales volume distributionafter H2 start up(2)

Current net revenue distribution(1)



41

Schedule

Startup

Utilities clearanceand commissioningL1 interconnections

during maintenancedowntime

Initial hiring of harvestworkers

Hiring of operationalteam

Negotiations withconcession holders and

Port of Santos tendering

2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17

2015 2016 2017

Beginning ofinfrastructure and

purchase of the TGs

Purchase of theindustrial plants

Beginning of construction

Beginning of assembly

Beginning of forest

machinery deliveries

Beginning ofharvest

Definition of outboundlogistics formats

Updated video

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

https://www.youtube.com/watch?v=h3zALXVhRg0&feature=youtu.be

https://www.youtube.com/watch?v=h3zALXVhRg0&feature=youtu.be



42

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

Forestry Logistics



43

y gLow average distance from forest to mill

FOREST MILL

95 km

H1 + H2 consolidated

Outbound logistics



44

gFibria has logistical alternatives on a competitive basis

Ports Highways Railroads Waterways

Data Collection / Preliminary

Analysis Logistics Costs Opex - Rates Capex

Qualitative Modal conditions

Analysis

Mato Grosso

Mato

Grosso do

Sul

Goiás

Brasilia

Expansion CAPEX update



45

From US$2.5 bi to US$2.2 bi

0.65

0.32

0.05

0.20

2.5

2.2

Original Revised

BRL EUR USD and others

72%

26%

2%

72%

19%

9%

FX and inflation partially offset by the negotiation with suppliers

CAPEX (US$ billion)

3%

60%

33%

3%1%

2015 2016 2017 2018 2019 andthereafter

Timetable

F di



46

Funding

Amortization Schedule (2) – 1Q16 Proforma with TLS II – US$ million

Cost and maturity:

1Q16 1Q16 + H2

Average Cost (US$ p.a) (1)

Average Maturity (years)

3.4%

4.2

3.0%

4.7

H2

2.2%

5.9

(1) Considering swap transactions. | (2) Debt FX 1Q16: 3,5589 / FX considering new funding for the TLS II Project: 3,5589

177

289

537

955

450

659

179 165

768

153 13750

11

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

BNDES Bond PPE NCE ACC/ACE CRA ECA Outros FDCO Total

Funding Sources



47

Funding – Sources

(1) Working capital to be released in 2016 and 2017 in commercial deals with Klabin and shipping agreements

R$ 8.7 billion

BNDES CRA FDCO ECAs Banks WK release(1) Total

Rating agencies understand that the Project will not jeopardize



48

Fibria’s credit metrics

“We expect Fibria to continue benefiting from higher operating cash flows whichwould allow it to enlarge its Três Lagoas industrial complex while keeping its debt at

reasonable levels for a low investment-grade rating”

“Fitch’s base case, which assumes that the company builds a new pulp mill (TrêsLagoas 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)

. Netleverage would quickly decline to around 2.5x(1) once the mill becomes operationalin the second half of 2017”

(1) According to rating agency methodology

Project financials at a glance



49

Project financials at a glance

UNIT R$ US$

Pulp production/year k tons 1,850 1,850

Expansion capex(1) $ billion 8.7 2.2

Expansion capex(1) $/t 4,702 1,204

Sustaining capex(2) $/t 193 49

Cash cost(3) $/t 341 87

Energy surplus MWh 120 120

Project approval FX R$/US$ 2.80 -

All in cash cost (estimated range)(4) $/t - 250-300

Pulp price(5) $/t - 532

Free Cash Flow (estimated) $/t - 261-311

Payback period (estimated) years - 3.9-4.6

(1) Includes chemical leasing and investments in order to increase capacity to 1,850 kt/year.(2) Estimated sustaining capex in perpetuity considering capacity of 1,850 kt/year.(3) Estimated weighted average cost, after mill balance. Includes energy sales .(4) Range considering production cash cost of US$ 87/t (Dec, 31 FX – 3.9048)(5) 2016 market consensus

We don’t think that such competitiveness is easily replicable, since the



Although some potentialbrownfields are listed,

there are significantchallenges.

scenario is becoming more complex…

Land

Infrastructure/Logistics

Certified wood availability

Environmental requirements

Public funding constraints

Governance standards

Cost of capital

Credit rating



51Dividends

Policies approved by the Board of Directors



52

►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

Policies approved by the Board of Directors

Approval of Dividend Policy



53

Approval of Dividend Policy

►Proposed dividends based on cash generation, taking into considerationthe company’s strategic planning and in line with its policies, notably the

Indebtness and Risk Management policies.

►Preserving Investment Grade.

Commitment to Corporate Governance best practices.

Extraordinary dividend if Policy criteria are met.

Dividends



54

Dividends

Dividend yield as of Dec, 31, 2015 = 7.5% (R$) | 8.3% (US$)Dividend yield as of Dec, 31, 2014 = 11.6% (R$) | 8.7% (US$)

OGM: Dividend

distribution approval:

minimum compulsory

+ additional

April 28, 2015 May 14, 2015

Dividend Paymentof

US$49 million

EGM: Interim Dividend

Payment Approval

Nov. 30, 2015 Dec. 9, 2015

Dividend Paymentof

US$532 million

Oct. 22, 2015

Dividend Policy

Approval

April 27, 2016

Dec. 17, 2015

Dividend

distribution

proposal of US$78

million(2)

approved by the

Board of Directors

OGM approved

dividend distribution

of US$80 million(1)

(1.1% of dividend yield

as of Dec, 31, 2015).

Mid-May, 2016

Dividend payment of

US$80 million.

2015

2016

Mid-November, 2016

Extraordinary

dividend

appraisal

Mid-December, 2016

Extraordinary

dividend payment

(if approved)

(1) Considering March 7, 2016 FX – R$/US$3.7714

Dividends vs Leverage



55

Dividends vs. Leverage

148

2,000

2.30

1.95

1.58

1.781.86

0,00

0,50

1,00

1,50

2,00

2,50

1Q15 2Q15 3Q15 4Q15 1Q16

Dividends (R$ million) Leverage (x)

Historical Dividend Yield(1)



56

Historical Dividend Yield

(1) Source: Bloomberg – Financial Analysis - Multiples

Considering

Market Capas of December,31st, 2015

Best dividend yields of 2015 among Brazilian corporate issuers



57

Best dividend yields of 2015 among Brazilian corporate issuers

Source: Economática – the dividend yield calculation considers share price at the beginning of 2015

Dividends pershare (R$)

Dividend Yield(%)

Cesp 4.85 20.78

Fibria 3.88 11.60

Santander BR 0.46 9.81

Qualicorp 1.89 7.02MRV 0.39 5.55

BBSeguridade 1.68 5.53

TelefBrasil 2.73 5.32

Natura 1.48 4.67

Braskem 0.61 4.64

CSN 0.41 4.48



58

Cost reduction initiatives and industry statistics

Structural Competitiveness



59

p

1. Third-party wood reduction

2. Forestry operations productivity

3. Industrial

NPV: US$0.4 billion

NPV: US$0.6 billion

NPV: US$0.1 billion

Total : US$1.1 billion




0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

p y

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.

Estimated level for

2015

Third-party wood decrease will benefitopex and capex

59




► 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

Losango

60




The distribution costs by classes help us to apply resources

in order to optimize wood production

10%

20%

40%

20%

10%10%

36%33%

15%

6%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

01 - Diamond 02 - Gold 03 - Silver 04 - Bronze 05 - Lead

Current effective area Future effective area


CLASSIFYING THE FOREST BASE BY CATEGORIES

Structural change improving competitiveness

61




Possible Restrictions

Declivity

0: Higher than 35°

1: Btw 24°and 35°

2: Btw 0° and 24°

ConservationAreas

0: Within CAs(1)

1: Within EPA(2) and

EBZ(3)

2: Out of EPAs and

EBZ

MunicipalRestrictions

0: Total restrictions

1: Partial restrictions

2: No restrictions

EPA Altitude

0: Higher than1800m

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 Impediments

Possible combinations

X 0, 1 and 2, removed;

4 e 8, high potential(1) ConservationAreas

(2) EnvionmentalProtection Areas

(3) Environmental Buffer Zones

Identifying opportunities based on these combinations

62




Roads

Transportation

SilvicultureHarvest

Cost and Capex KPIs were also included in this geo-model

63




Mixed Harvest Mechanization (Hilly areas)

► 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

PROJECT DESCRIPTION (JACAREÍ UNIT)

Harvest

64




PIFF

► Freight cost reduction;

► Increased load box for timber/woodchiptransport

► Use of lightweight steel;

► Operational risk reduction (flipping);

► Investment: R$33 million


► Startup: 2015 / 2016

PROJECT DESCRIPTION (ARACRUZ, JACAREÍ AND TRÊS LAGOAS UNITS)

Timber transportation Woodchip transportation

Transportation

65




Maritime Wood Shipping Project

► Capex and Opex reduction;

► Increase in cargo handling due to increase in

stack height volume

► Reduction in heavy truck road traffic



► Startup: Jan/2017

PROJECT DESCRIPTION (ARACRUZ UNIT)

Transportation

66

2 St t l h i f t ti d ti it



10%

30%

50%

70%

90%

100%

0%

20%

40%

60%

80%

100%

2015 2016 2017 2018 2019 2020

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

67

3 I d t i l i t d ti h d l h



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


68

3 I d t i l Bi l i l Sl d D



Biological Sludge Dryness Process

3. Industrial: Biological Sludge Dryer

► Variable cost reduction associated

with the disposal of sludge operations

in external landfill



► Startup: Dec./2016

PROJECT DESCRIPTION (JACAREÍ UNIT)

Operational Flow –

Conditioning and biological sludge burn

•00Effluent+Sludge

Aeration Tank

Biological

Sludge Tank

•00Biomass Pile

Sludge Dryer

Biomass

Boiler

Sludge drying and burn in biomass boiler

69

Fibria’s tax structure



71

Description and Amount Maturity

(a) Operating income As stated in the income statement

(-)(b) Goodwill (Aracruz

acquisition)

- Annual tax deduction: US$ 23 million (tax)

- Remaining Balance mar/16: US$ 0.216 billion (base) 2018

(-)(c) Forestry Capex in MS

state (net)2016 tax deduction related to depletion: US$ 5.7 million Undefined

(+/-)(d) Exchange variation

(cash)---------- ----------

(+/-)(e) Other ---------- ----------

Tax base before

compensations

(a) + (b) + (c) + (d) + (e)

(f) (-) Tax loss carryforward

- Up to 30% of tax base before compensations

- Balance up to mar/16: US$ 50 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(3)

Balance mar/2016:

-PIS/COFINS: US$ 168 million

-Advanced tax payment (IR and CSLL): US$ 240 million

Undefined

Cash Tax Income Tax (h) – tax credits (i)

2010 2011 2012 2013 2014 2015 1Q16

US$ 9 million US$ 2 million US$ 8 million US$ 14 million US$ 12 million US$ 23 million US$ 1 million

TAX PAYMENT (cash basis)

(1) Considering FX 3.5589 | (2) Considering average FX for the period | (3) The company also has Reintegra credit, which impacts COGS – US$ 26 million

Leadership Position



72(1) FiberConsumption, Recycled Fiberand Pulp: RISI | Market Pulp, Hardwoodand Eucalyptus: PPPC Global 100 ReportDecember2015

Recycled Fiber

242 million t

46% 54%

59%

18% 82%

59% 41%

41%

30% 70%

25%75%

Fiber Consumption

412 million t

Pulp

169 million t

Chemical

140 million t

Mechanical

30 million t

Integrated Mills

83 million t

Market Pulp

57 million t

Hardwood

31 million t

Other Eucalyptus

Pulp producers:

16 million t

Softwood/Other

26 million t

Acacia/Other

9 million t

Eucalyptus

21 million t

Industry Outlook(1)

Global Market Pulp Demand



73

Demand growth rateHardwood (BHKP) vs. Softwood (BSKP) (000 ton)

Hardwood demand will continue to increase at a faster pace than Softwood

Source: PPPC report (Sept. 2015) Source: PPPC reports. Excludes Sulphite and UKP market pulp (Sept./15)

0

5.000

10.000

15.000

20.000

25.000

30.000

35.000

40.000

1 9 9 8

1 9 9 9

2 0 0 0

2 0 0 1

2 0 0 2

2 0 0 3

2 0 0 4

2 0 0 5

2 0 0 6

2 0 0 7

2 0 0 8

2 0 0 9

2 0 1 0

2 0 1 1

2 0 1 2

2 0 1 3

2 0 1 4

2 0 1 5

2 0 1 6

2 0 1 7

2 0 1 8

2 0 1 9

Hardwood Softwood

2014 - 2019 CAGR:Hardwood: +2.5%Softwood: +0.8%

000 ton 1999 2009 2019Growth1999-2009

Growth2009-2019

Hardwood 16.3 24.8 33.8 52% 36%

Eucalyptus 6.0 15.9 24.1 165% 52%

Softwood 19.0 21.4 24.9 13% 16%

Market Pulp 35.3 46.2 58.7 30% 27%

Paper Production – Runnability with BHKP

Source: RISI conference, August 2014.

Benefiting From China’s Growth



74

World Tissue Consumption, 1991-2013 (3)

Per Capita Consumption of Tissue by World Region (3)China's Share of Market Pulp (2)

24

15 15

12

7 65

1

N.

America

West

Europe

Japan Oceania East

Europe

LatAm China Africa

10% 10%12% 14%

21%

17%

22%23% 23% 24%

25%

0

2

4

6

8

10

12

14

0%

5%

10%

15%

20%

25%

30%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Eucalyptus Hardwood Total % Compared to the global Market Pulp

(Kg/capita/year)

(million t) (kg/person/year)

Between 2005 and 2015,

the Chinese market share

of eucalyptus shipments

increased by 20 p.p. (total

market pulp: + p.p.)

0

5

10

15

20

25

30

35

1991 1996 2001 2006 2009 2010 2011 2012 2013

N.America W.Europe E.Europe L.America

Middle East Japan China Asia FE

Oceania Africa

LTM GrowthRate +4.2%

(1) PPPC – Pulp China – Flash Report – March 2016

(2) PPPC – W20. Coverage for chemical market pulp is 80% of world capacity

(3) RISI

(million t)

2.215

1.095

503 530

47 40 1

2.368

1.292

453 525

49 43 8

BHKP Total Latin

America (1)

Indonesia Others(2) USA Canada Western

Europe

1Q15 1Q16

Latin America is the

leading exporter of BHKP

to China, accounting to

approximately 55% ofChina's total imports in

1Q16.

(‘000s t)

(1) includes South Africa and New Zealand. | (2) Includes China, Japan, Malaysia, Russia, Thailand and Vietnam.

China’s Hardwood Imports of BHKP by Country (1)

Growth rate Chinese GDP vs. Eucalyptus Shipments to China



75

yp p(Sept-09 = base 100)

Source: Bloomberg and PPPC.

74

206

-

50

100

150

200

250

China GDP Eucalyptus Shipments

Commodities Differentiation



76

China GDP breakdown

China commodity demand - basis 100

49% 49% 48% 49% 49% 50% 50% 52% 51% 53% 53%

44% 47% 48% 48% 48% 48% 48% 46% 47% 45% 45%

8% 4% 4% 3% 3% 2% 2% 2% 2% 2% 2%

2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015E 2016E 2017E 2018E

Consumption Investment Net Exports

2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015E 2016E 2017E 2018E

Corn Soybeans Wheat Crude oil Iron ore Sugar BHKP

100

248

201194172

152

124115

Source: Itaú Macroeconomic Department and PPPC – Oct/15

Global Paper Consumption



77

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Developed Markets Emerging Markets

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Developed Markets Emerging Markets

CAGR 1996 – 2006Developed Markets: + 1.7%Emerging Markets : + 6.0%

85,291

117,611

15,548

37,474

P&WConsumption(000 tons)(1)

TissueConsumption(000 tons)(1)

114,507

CAGR 2007 – 2016Developed Markets: - 4.0%Emerging Markets : + 4.1%



26,877

Source: RISI

Global Market BEKP Demand



Shipments of Eucalyptus Pulp

(1) Source: PPPC World 20 – January/2015

CAGR 2012-2015

3,787kt

387 kt662 kt

1,980 kt

758 kt

8%

7%3%

19%

6%

Total North America Western Europe China Others

Documents

Santander Pulp