Klabin Day 2024 Conference Call Summary Company Overview - **Company**: Klabin - **Industry**: Paper and Pulp Key Points and Arguments Business Model and Strategy - Klabin emphasizes its unique business model that cannot be easily replicated by competitors, particularly due to its geographical advantages in Brazil for growing pine and eucalyptus trees [6][8][10] - The company has a diversified product portfolio that includes moisture-resistant products, which are primarily made from pine, and is positioned to meet the needs of various markets, including food-grade products and hygiene [15][17] - Klabin has strategically split its operations into three segments to reduce volatility and target niche markets with higher pricing potential [13][19] Financial Performance - Gabriela Woge, the CFO, highlighted that Klabin raised $10 billion in capital, significantly changing its debt structure by reducing dollar-denominated debt and extending payment timelines [5] - The company aims to maintain stable costs, with projections indicating that costs will remain below inflation rates through 2026 [38][41] - Klabin's cardboard customers have long-term contracts (3-5 years) that account for inflation fluctuations, providing revenue stability [20] Production and Operational Efficiency - Klabin has faced production challenges but has successfully normalized production levels, leading to positive results despite global uncertainties [40][43] - The company has invested in high-end technology to improve efficiency, such as reducing the weight of its paper products while maintaining quality [50] - Klabin is focused on operational continuity and has a dedicated team to assess and improve its production processes [51] Market Position and Competitive Advantage - Klabin is recognized as a market leader in Brazil and has established contracts with major global brands in the food and beverage sector [15][19] - The company has a strong asset base, with land values in key regions (Paraná, São Paulo, Santa Catarina) significantly exceeding its market capitalization [11][33] - Klabin's ability to assess land potential and execute large investments positions it as a benchmark in the Latin American market [34] Future Outlook - Klabin does not have new investments in the pipeline but is focused on leveraging existing assets and improving cash flow generation [31][32] - The company plans to continue selling land to enhance financial results, with expectations of achieving higher prices for these assets [46][62] - Klabin is preparing for a new cycle of operational continuity and forestry operations to ensure sustainable growth [50][51] Challenges and Risks - The company acknowledges challenges related to climate issues, inflation, and fluctuating costs, but remains committed to maintaining cost stability [40][43] - Klabin's management is aware of the need to adapt to market changes and is actively seeking initiatives to offset rising costs [43] Additional Important Information - Klabin's governance structure and operational continuity have been well established, serving as a benchmark in the industry [53] - The company is committed to paying dividends and maintaining shareholder value, with plans to issue new shares to increase its capital base [46][47] - Klabin's long-term strategy includes preparing for future investments in forestry and land management to ensure sustainable operations [50][51] This summary captures the essential insights from the Klabin Day 2024 conference call, highlighting the company's strategic direction, financial performance, market position, and future outlook.

Company Strategy and Outlook - Klabin reaffirms its commitment to developing its people for future challenges and ensuring management continuity with a culture of excellence[10] - The company emphasizes strategic planning and financial discipline as drivers for capital allocation, aiming to maximize shareholder value generation[27, 29] - Klabin is focused on extending debt maturities and reducing debt, reinforcing its deleveraging trajectory[32] Financial Performance and Discipline - Klabin maintains its 2025 guidance, reflecting its ability to adapt and capture efficiencies[41] - The company projects total cash cost to be less than R$3300 per ton in 2026, assuming an accumulated IPCA of 14% which would be R$3600 per ton[38, 39] - Klabin anticipates CAPEX between R$2 billion and R$25 billion for 2026[45] Shareholder Returns - Klabin declared interim dividends of R$11 billion based on accumulated profits recorded in 2025[47] - The company is increasing capital with bonus shares, representing 1% of the current share base[50] - Klabin paid R$13 billion in dividends in LTM3Q25, representing a 55% dividend yield[32] Competitive Advantages - Klabin has a unique forest asset base, providing privileged access to long fiber and high forest productivity[17, 19] - The company has a diversified business model with leadership positions in niche markets, including a 22% market share in corrugated boxes and a 50% market share in industrial bags in Brazil[20, 24]