Suzano S.a. · BMFBOVESPA:SUZB3
Suzano — Investor Day (February 2020)
44 slides from Suzano's investor day presentation, Feb 13, 2020
Slide 1: Suzano Day 2020
SUZONO Day 2020
Slide 2: Disclaimer
Disclaimer This communication contains certain statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. Some of these forward-looking statements are identified with words like “believe
Slide 3: Suzano one year post-merger
Suzano one year post-merger The future of Suzano
Slide 4: Suzano one year post-merger
Suzano one year post-merger The future of Suzano
Slide 5: 2019 Adjusted EBITDA and Operating Cash Generation
2019 Adjusted EBITDA (R$ Bn) Operating Cash Generation R$ 10.7 Bn R$ 7.1 Bn (R$ Bn) 2.2 3.1 2.8 1.8 2.5 2.4 1.5 1.5 1Q19 2Q19 3Q19 4Q19 1Q19 2Q19 3Q19 4Q19
Slide 6: Paper results: EBITDA, sales volume and price
Paper Adjusted EBITDA (R$ millions) Sales volume (k ton) Net average price (R$/ton) Record high 1,373 4100 1,500 1,285 1,180 1,165 3900 1.2 1,300 3,773 100 1,100 922 3700 80 900 3,547 3500 700 60 3300 500 40 300 3100 20 3,070 100 0 0 2900 4Q18 3Q19 4Q19 2018 2019 2017 2018 2019 2017 2018 2019 (100)
Slide 7: Pulp price, sales volume and cash cost
Pulp Net average price (US$/ton) 711 Cash Cost Ex-downtimes1 2019 average: on 526 Record high 697 697 Sales volume (k ton) 654 649 649 631 2,920 2,214 2017 2018 1Q19 2Q19 3Q19 4Q19 1Q19 2Q19 3Q19 4Q19 adjusted by inflation (IPCA) Destocking 2,549 1,729
Slide 8: Robust balance sheet: liquidity and amortization schedule
Robust balance 6.6 Liquidity and Amortization schedule Achievemenstsheet US$ Billion 3.1 Stand-by facilities 2.4 2019 Covenants exclusion 1.8 1.5 1.5 1.3 Cash on hand 0.7 0 Liquidity enhancement 2020 2021 2022 2023 2024 2025 2026 onward Liquidity 86% Average term extension Net debt (US$) 4,9 x Lever
Slide 9: Robust balance sheet including Feb/2020 roll-over
Robust balance Liquidity and Amortization schedule (including Feb/2020 roll-over) Achievemenstsheet 6.67 US$ Billion 3.1 Stand-by facilities 2.4 2.3 2.1 2019 Covenants exclusion 1.9 1.5 1.3 1.0 Cash on hand 0.7 0.4 00 Liquidity enhancement 2020 2021 2022 2023 2024 2025 2026 onward Liquidity 86% Aver
Slide 10: Financial discipline: capex and inventory monetization
Planned Executed Capex limited to sustaining and commitments already made 2019: R$ 5.78 Bn (below original guidance) 2020: R$ 4.44 Bn Monetization of excesso inventories of ~US$ 500 Millions 1.1 M tons inventory reduction in 2H19 Non-core assets sale Sale of R$ 0.4 Bi in forests Financia lDisciplin
Slide 11: Synergies
Synergi es R$ 800-900 M R$ 720-810 M 2019 2020 2021 Steady state in full capacity R$ 320-360 M
Slide 12: Synergies updated
Synergi es Updated R$ 1,100-1,200 M R$ 1,000-1,100 M 2019 2020 2021 Steady state in full capacity Note: R$ 311 million including the negative impact of implementation costs and production reduction R$ 763 M
Slide 13: Integration: one culture, process and system
Integrat january january 2020 ONE UMA ONE ONE 201i9 ocnomp cultur proces s syste m anyNew culture e People who inspire and transform Unified processes and systems 91% adherence It´s only good for us if it´s good for the world Create and share value
Slide 14: The future of Suzano
Suzano one year post-merger The future of Suzano
Slide 15: Video: Megatrends and Opportunities
Vídeo: Megatrends and Opportunities
Slide 16: Megatrends and opportunities for Suzano
Opportunities for Suzano Megatrends Reduce usage of plastics Urbanization Growing and aging population Trends and Renewable materials and inputs Climate change Opportunit ies Carbon capture Tecnology and Digitalization Emerging economies growth
Slide 17: Strategic vision
1Continue being a benchmark in the sector in efficiency, Strategi profitability and sustainability, from the forest to the client vision 2expansion into new markets for our Be a transformational agent in the c biomass 3Be a reference in sustainable and innovative solutions for the bioeconomy and env
Slide 18: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 19: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 20: Value creation: total operational disbursement
Value creation Total Operational Disbursement (R$/ton)(1) 1,584 ~1,300 Sustaining Capex +addiRtiona$l cash g2ener.at8ion Bn SG&A + freight Production Cash Cost (incl. downtime) 706 ~560 2024 2 US$ ~329/ton 2019 US$ 401/ton (1) Real figures. Average 2019 FX : R$ 3.95/US$. Does not include working cap
Slide 21: Forest planning and average forest-mill distance
Foreplsatnning 37% Third-party wood 23% Average forest-mill distance (km) 2019 2024 228 156
Slide 22: Digital Forest
Digital Forest and ..B. to harviestoand t From clone... transportation y Pests and diseases resistance MAICel Clonal allocation Stresses tolerance Wood quality Producemor withless eresilient forests
Slide 23: Cerrado Project
Vértere Pro+j4e.0ct M tons/year Picture: January 2020
Slide 24: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 25: Organic growth demand
Organic growth demand Global Pulp Demand1 Organic growth 1.1 – 1.5 million tons/year Current Demand Organic Growth Above 2.0%/year +0.5 a +2.0%/year -0.5 a +0.5%/year Below -0.5%/year 1. Illustrative graph Source: Pöyry, Fisher, PPPC, and Suzano BI
Slide 26: Fiber to fiber substitution potential
Fiber to Global Pulp FDemianbd1 er Substitution potential Fiber availability Recycled Paper Integrated Pulp At least 0.5 million tons/year CurrentOrganic Growth Fiber to Fiber Demand Current 5-10 years Current 5-10 years 1. Illustrative graph Source: RISI, Suzano BI
Slide 27: Growth Roadmap
Growth Roadmap 2.M2ton-s/year 2.5 Structural average radius: 50km 100k hectares of already acquired land Ribas do Rio Pardo Vértere Note: growth optionality
Slide 28: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 29: Execution: new brands and market share
Execution New brandcs apabMiarklet iShatre inyValue | Dec 2019 launching 3.9% 6.5% Inorganic Organic Current New Espírit t in with Pow rPoint mone ation Source: Nielsen 2017 2018 2019 2020 2.6%
Slide 30: Execution: market share in value
Execution New brandcs apabLeaMdiearrklsehtiipShiantreNinoyrVtahluaen|dDNeco2r0th19east launching markets 3.9% 6.5% Market share in value | Dec 2019 527.6%% New Espírit t in with Pow rPoint mone ation North Northeast 2nd player Suzano Source: Nielsen 2017 2018 2019 2020 Inorganic Organic Current 22%
Slide 31: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 32: Suzano: pulp, energy and bio-chemicals
Suzano Marketpulp Energy Bio-chemicals Future Lignin Resins FF, dispersants, plastics, elastomers, etc. State-of-the-art forests Highly productive mills Textiles, resins, etc. Dissolving Pulp Sugars Sweeteners, furfural, etc. Paper, textiles, paints, wood panels, etc. MFC Fiber/ PE/ PP/ PLA Biocompo
Slide 33: Potential addressable markets
Suzano BPiapeor and Pasckagintg rat 3.3 Potencial addressable markets (USD Bn/year) Textile 9.0 Plastics 16.0 Fuels 17.0 Technology Partners Chemicals 10.0 Furniture 1.8 Automotive 1.0 Construction 1.0 Animal Nutrition 1.3 Application Partners Agriculture 3.0 Source: IHS, CCM Market Data, Rubber, Ch
Slide 34: Plastics substitution
F Plastics substitu 20% to ... multiple 60% Already tested applications applications of fibers in the composite tion One solution... Cost competitive pulp versus fossil resins Pulp Reduced CO2 footprint
Slide 35: Fossil to fiber: textile market
Fossil to extile Relevant market growth Market Fiber The interest in sustainable products reinforces our differential Annual textile production per fiber (M tons) The textile industry today: 119 107 8%-10% of greenhouse effect emissions 92 Wood 5 20% of water pollution due to industrial waste Synthe
Slide 36: Disruptive and sustainable textile platform
Disruptive and highlysustainable platform in textile Pulp Mechanical refining Micro Fibrillated Cellulose (MFC) Fiber suspension Certified wood Textile Fibers Staple Fiber/Filament Extrusion and drying
Slide 37: Tomorrow
RCI =TOMORROW
Slide 38: Fossil to fiber: single-use paper
Fossil Fiber to Single-useto paper 87 1cou2ntries7 tonnes of plastic packaging million 500 billion plastic bags/year Equivalent to 1new pulpmill Substitution into paper products 20 380 billion plastic cups/year Source: Pöyry, Datamark, Suzano BI
Slide 39: Expanded addressable market
Expanded Addressable Market Demand1 Global Pulp ed Faoslsil to Fiber Current Demand Organic Growth Fiber to Fiber Future Demand 1. Illustrative graph Expand potenti
Slide 40: Strategic vision
1Ser referência do setor Visão estratég em eficiência, rentabilidade e sustentabilidade, da floresta ao cliente 2na expansão em novos Be “Best-inSer agente transformador -Class” in Maintain relevance Advance in the links of the chain, always with competitive advantage Expand boldly into Play a leadi
Slide 41: Play a leading role in sustainability
Play a leading role in sustainability Climate change Reduce specific emissions in 15% Energy Increase exports in 50% Water • Forest: Increase water availability in 100% of critical watersheds • Industry: Reduce 15% of collected water Diversity and Inclusion • 30% of women and 30% of black people in
Slide 42: Ambitious sustainability goals
Play a leading role in sustainability Even more Replace plastics and Mitigate the income distribution problem oil-derivatives climate positive +10 million tonnes Zero people below the poverty line in our influence areas (~200 thousand people) -40 million tonnes of carbon Ambitious sustainability goa
Slide 43: Efficiency, bigger market, sustainability and financial discipline
More efficiency Bigger addressable market Leading role in sustainability Value Strong financial discipline
Slide 44: Suzano Day 2020
SUZONO Day 2020