Suzano S.a. · BMFBOVESPA:SUZB3
Suzano — Q2 2023 Earnings Presentation
41 slides from Suzano's earnings presentation, Aug 3, 2023
Slide 1: Average net pulp price
Average net price in USD of pulp sold by Suzano was US$571/ton, decreasing 21% from both 1Q23 and 2Q22. In the export market, average net price was US$562/ton, decreasing 22% and 23%, respectively, in the same comparison basis. Average net price in BRL was R$2,825/ton in 2Q23, down 25% from 1Q23, du
Slide 2: Pulp net revenue
Net revenue from pulp decreased 23% from 1Q23, due to the lower net average price in USD (-21%) and the decline in average USD against average BRL (-5%). Compared to 2Q22, revenue decreased 25% due to the lower net average price in USD (-21%) and lower sales volume (-6%), partially offset by the inc
Slide 3: Pulp Net Revenues (R$ million)
Pulp Net Revenves (RS million) j— +25% —— -23% 9,508 9,201 8,907 8,535 2azz 1023 Brazilian Market Ml Export Market
Slide 4: Consolidated Pulp Cash Cost ex-maintenance downtime
Consolidated Pulp Cash Cost ex-maintenance downtime (RS/t) 47% -2% 2Q22 1023 2Q23
Slide 5: Cash cost excluding downtime vs 1Q23
Cash cost excluding downtime in 2Q23 stood at R$918/t, decreasing 2% from 1Q23, due to: i) lower prices of inputs, especially energy (lower natural gas prices due to the decline in Brent prices) and lower chemical prices (especially of caustic soda due to lower international prices - HIS); ii) lower
Slide 6: Cash cost vs 2Q22
¹Excludes the impact of maintenance and administrative downtimes. Cash cost excluding downtime in 2Q23 was 7% higher than in 2Q22, due to: i) higher fixed costs resulting from higher labor and maintenance costs and lower cost dilution due to lower production; ii) higher wood costs, especially due to
Slide 7: Cash cost excluding maintenance downtimes
¹Excludes the impact of maintenance and administrative downtimes.
Slide 8: Cash Cost 2Q23
Cash Cost 2Q23* Fixed costs Wood Other variables ess Chemicals
Slide 9: Pulp Segment EBITDA
Pulp Segment 2Q23 1Q23 Δ Q-o-Q 2Q22 Δ Y-o-Y LTM 2Q23 23,465 10,524 2,230 ¹Based on cash cost excluding downtimes. Excludes energy sales. PULP SEGMENT EBITDA Adjusted EBITDA (R$ million)¹ 3,190 5,336 -40% 5,600 -43% Sales volume (k ton) 2,513 2,455 2% 2,663 -6% Pulp adjusted¹ EBITDA (R$/ton) 1,269 2,
Slide 10: Pulp adjusted EBITDA
¹Excludes non-recurring items.
Slide 11: Operating cash generation from the pulp segment
Pulp Segment (R$ million) 2Q23 1Q23 Δ Q-o-Q 2Q22 Δ Y-o-Y LTM 2Q23 23,465 (5,753) 17,712 OPERATING CASH GENERATION FROM THE PULP SEGMENT Adjusted EBITDA 1 3,190 5,336 -40% 5,600 -43% Maintenance Capex 2 (1,547) (1,338) 16% (1,149) 35% Operating Cash Flow 1,642 3,998 -59% 4,450 -63% ¹Excludes non-recu
Slide 12: Paper business performance
PAPER BUSINESS PERFORMANCE The following data and analyses incorporate the joint results of the consumer goods and paper businesses (tissue). PAPER SALES VOLUME AND REVENUE According to data published by Brazil's Forestry Industry Association (IBÁ), demand for Printing and Writing in Brazil, includi
Slide 13: Paper average net price
¹Includes the Consumer Goods Unit. Average net price decreased 5% from the previous quarter, due to the cooling of demand in the international Printing and Writing markets and the greater availability of inventories in the chain, while in the domestic market prices remained stable. Compared to 2Q22,
Slide 14: Paper net revenue
Net revenue from paper sales amounted to R$2,058 million, down 1% from 1Q23, reflecting mainly the lower net average price in the export market (-20%), partially offset by the 5% increase in sales volume. Compared to 2Q22, the 2% increase was due to price increases, mainly in the domestic market, pa
Slide 15: Paper Segment EBITDA
Paper Segment 2Q23 1Q23 Δ Q-o-Q 2Q22 Δ Y-o-Y LTM 2Q23 3,380 1,243 2,718 ¹Includes the Consumer Goods Unit. PAPER SEGMENT EBITDA Adjusted EBITDA (R$ million) 1 -11% 4% Sales volume (k ton) 5% -9% Paper adjusted 1 EBITDA (R$/ton) 2,481 2,921 -15% 2,167 14% ¹Excludes non-recurring items. Adjusted EBITD
Slide 16: Adjusted EBITDA and Margin of Paper
Adjusted EBITDA (R§ million) and Adjusted EBITDA Margin (%) of Paper 39% anal 703 2Q22 1023 2023 ‘=e Adjusted EBITDA Margin lJ EBITDA Paper
Slide 17: Operating cash generation from the paper segment
Paper Segment (R$ million) 2Q23 1Q23 Δ Q-o-Q 2Q22 Δ Y-o-Y LTM 2Q23 3,380 (581) 2,798 OPERATING CASH GENERATION FROM THE PAPER SEGMENT Adjusted EBITDA 1 -11% 4% Maintenance Capex 2 (169) (127) 33% (99) 71% Operating Cash Flow -19% -7% ¹Excludes non-recurring items. ²Cash basis.
Slide 18: Financial performance: net revenue
FINANCIAL PERFORMANCE NET REVENUE Suzano’s net revenue in 2Q23 was R$9,160 million, 77% of which came from exports (vs. 81% in 1Q23 and 83% in 2Q22). In relation to 1Q23, net revenue decreased 19% is explained by the lower average net pulp price in USD (-21%), lower average net paper price in USD on
Slide 19: Net Revenue (R$ million)
Net Revenue! (R$ million) 9,125 2,151 2,071 2022 1023 2023 WB Brazilian Market Ml Foreign
Slide 20: Calendar of scheduled maintenance downtimes
Mill – Pulp capacity 2022 2023 2024 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 ¹Does not include Portocel service revenue. CALENDAR OF SCHEDULED MAINTENANCE DOWNTIMES Aracruz - Mill A (ES) – 590 kt No downtime Aracruz - Mill B (ES) – 830 kt No downtime Aracruz - Mill C (ES) – 920 kt
Slide 21: Net income (loss) and debt
Debt (R$ million) 2Q23 1Q23 Δ Q-o-Q 2Q22 Δ Y-o-Y NET INCOME (LOSS) In 2Q23, the Company posted net income of R$5,078 million, as against R$5,243 million in 1Q23 and R$182 million in 2Q22. The 3% decline in relation to 1Q23 was due to lower operational result and higher deffered income tax and social
Slide 22: Average cost and term of debt
*Corresponding mainly to transaction costs (issue, funding, goodwill, discount and loss on business combinations, etc.). On June 30, 2023, total average cost of debt in USD was 4.9% p.a. (considering the debt in BRL adjusted by the market swap curve), compared to 4.7% p.a. on March 31, 2023. The ave
Slide 23: Cash and liquidity
¹Considers the debt portion with swap for foreign currency fixed rate. The exposure of the original debt was: Fixed (US$) – 56%, Libor/SOFR– 25%, CDI – 11%, Other (Fixed R$, IPCA, TJLP, others) – 8%. ²Considers the portion of debt with currency swaps. The original debt was 81% denominated in USD and
Slide 24: Net Debt (R$ and US$ million)
Net Debt (R$ and US$ million) s4g99 92788 57,103 55,227 54.317 LELLL 2Q22 3Q22 4Q22 1Q23 2Q23 Mrs Miluss
Slide 25: Net Debt / Adjusted EBITDA
Net Debt / Adjusted EBITDA in R$ and US$ (x) a 2.2 2.2 2 2.0 2.1 2.0 is 2.0 2022 3Q22 4a22 1023 2023 —e RS —eUSS
Slide 26: Debt maturity and capex
6M23 2024 2025 2026 2027 2028 onwards Total The breakdown of total gross debt between trade and non-trade finance lines on June 30, 2023 is shown below: Trade Finance¹ 8% 95% 56% 50% 50% 0% 26% Non-Trade Finance² 92% 5% 44% 50% 50% 100% 74% ¹EEC, ECN, EPP ²Bonds, BNDES, CRA, Debentures, among others
Slide 27: Operating Cash Flow per ton
Operating Cash Flow per ton (R$/t)? 54% 54% 1,692 1,714 785 2022 1023 2023
Slide 28: ESG and total operational expenditure
Accrual basis, except for the capex related to Cerrado Project (cash basis), as per the Cash Flow Statement. Considers the business combination with tissue segment from KC Brazil 2 Net of exchange variations on cash and financial investments. 3 Considers amounts related to derivative adjustments, le
Slide 29: Stock Performance
Stock Performance 130 70 Me ee RS Cae Me Be ee ee A “Bes
Slide 30: Capital stock and market capitalization
Source: Bloomberg. On June 30, 2023, the capital stock of the Company was represented by 1,324,117,615 common shares, of which 32,466,900 were held in treasury. Suzano’s market capitalization on the same date (ex-treasury shares) stood at R$57.1 billion. Free float in 2Q23 corresponded to 50% of tot
Slide 31: Free float and ownership structure
Foreign Free Float distribution 06/30/2023 (83+ NYSE) Local Institutional Tavestors Individual Investors ‘Ownership Structure (06/30/2023) Treasury other Shareholders ‘controlling Shareholders
Slide 32: Net revenue by market and product
Exports 7,089,050 9,125,564 -22% 9,518,474 -2606 16,214,614 17,425,854 -7% Pulp 5518076 8,534,778 -24%@ 8,906,683 -27% 15,052,854 16,249,456 -7% Paper 570974 $90,786 3% ©=—«GI1,791-7%@ 1,161,760 1.176.398 -1% Domestic Market 2,070,584 2150819 -4% © «2,001,181 3% «4.221403 5,836,636 10% Pulp 583192 6
Slide 33: Paper of other manufacturers sold by Suzano
¹Paper of other manufacturers sold by Suzano and tissue paper.
Slide 34: Pulp sales volume and prices: Domestic Market
Domestic Market Pulp Paper Total Pulp Paper 2922 2,783 6.766 5.433 3,400 7.037 3.263 2,825 7,002 3.877 3737 84s3 5.637 3,890 7.060 423 3,748 7,408 “21% 23% 3% 14% 736 17% “15% 21% 13% 3,590 3.482 6.304 4840 3,310 5.753 3.743 3.469 5915 2296
Slide 35: Paper prices and volumes
Paper Domestic Market Pulp Paper Total Pulp Paper “17% “21% 754 732 1337 965 643 1229 784 76 1.260 707 636 1241 ou 652 1133 737 683 1165 2296
Slide 36: Excluding non-recurring items and PPA effects
1 Excluding non-recurring items and PPA effects.
Slide 37: Balance sheet: current assets
Current Assets Cash and cash equivalents 11,860,415 4,761,264 7,712,081 Financial investments 7,913,750 12,206,095 12,337,762 Trade accounts receivable 6,488,192 9,403,801 5,865,962 Inventories 6,422,496 6,250,810 5,548,095 Recoverable taxes 741,847 588,241 422,129 Derivative financial instruments 3
Slide 38: Cash flow from operating activities
Cash flow from operating activities ‘Net income (loss) for the period 5,077,623 181,789 10,320,416 10,487,899 Depreciation, depletion and amortization 1.770680 1,824939 3,451,862 —=3,505,869 Depreciation of right of use 75,322 141.654 109,860 Sublease of ships - - 13: Interest expense on lease liabi
Slide 39: EBITDA calculation
1 The Company's EBITDA is calculated in accordance with CVM Instruction 527 of October 4, 2012.
Slide 40: Excluding non-recurring items and PPA effects
1 Excluding non-recurring items and PPA effects.
Slide 41: Excluding non-recurring items and PPA effects
1 Excluding non-recurring items and PPA effects.