Fibria announces 2009 results

Fibria announced its 2009 earnings results on February 26^th. Pulp sales were 5.248 million tons for the year, 27% higher than 2008, mainly due to the greater availability of the product after the startup of the Três Lagoas’ mill (Mato Grosso do Sul State) in March. Exports represented 90% of total pulp sales, with the Asian market absorbing the most — 1.9 million tons, 36% of the total. Exports to Europe represented 31%, North America 23% and Brazil/others 10%. Last year, 5.188 million tons of pulp and 369,000 tons of paper were produced.

Financial performance

Net revenues totaled R$ 6 billion, 1% above 2008. The increase was due to a 27% increase of pulp sales volumes, driven by the additional capacity from the Três Lagoas Unit. This positive result offset the 20% decrease in the net average price of pulp in reais. The adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was R$ 1.7 billion – 23% lower than in 2008. Fibria closed 2009 reporting net income of R$ 558 million for the year, reversing the R$ 1.3 billion loss registered in 2008. In order to permit comparisons between 2008 and 2009, Fibria’s consolidated earnings results are considered on a pro-forma basis in 2008, the same basis used for the company's consolidated statements in 2009.

Debt management

Fibria achieved significant progress in its liability management strategy in 4Q09, aiming at matching loan maturities with cash generation and improving its capital structure. The US$ 1.40 billion sale of the Guaíba Unit (Rio Grande do Sul State) was the first step in the plan. In line with this strategy, the company organized a US$1.0 billion Eurobond issue and raised US$ 1.2 billion through two tranches of pre-export financing lines. The US$ 3.6 billion raised through the plan was used to pay down US$ 2.1 billion of its derivatives debt. The full earnings release can be found at www.fibria.com.br/ir.

President Lula visits Fibria

Brazilian President Luiz Inácio Lula da Silva visited Fibria’s Três Lagoas Unit (Mato Grosso do Sul State) on February 19^th. President Lula toured the unit and was given a close up look at the most modern of Fibria’s six mills in Brazil, which represented a R$ 3.9 billion investment and came on stream on March 30^th, 2009. The unit has annual production capacity of 1.3 million tons of bleached eucalyptus pulp. There are more than 3,000 professionals currently working at the mill and its forest areas, including the company’s own employees and outsourced staff.

Forest recertification

In January, the Aracruz Unit (Espírito Santo State) obtained recertification of its management of planted forests in Espírito Santo, based on CERFLOR (Brazilian System of Forest Certification) principles and criteria. This certification, valid for five years and recognized internationally by the Programme for the Endorsement of Forest Certification (PEFC), reinforces Fibria’s commitment to minimizing the social and environmental impacts of its forestry operations. Each year, the unit is submitted to an independent audit of its forest management activities conducted by an accredited certifier.

Sustainability on the agenda

The management of Fibria’s Sustainability area met at the Aracruz Unit (Espírito Santo State) the last week of January to align 2010’s targets and present the principal work carried out in 2009 in communities near the company’s forestry and industrial operations. Some 30 professionals, including consultants, specialists and Sustainability area teams from all the Brazilian states where Fibria has activities, attended the event.

Bahia’s economic and social development

Fibria’s chairman José Luciano Penido was one of 45 persons sworn in as members of the Council for Economic and Social Development (CODES) in Salvador, Bahia State, on February 23^rd. CODES strives to strengthen the participation of civil society, through chosen representatives, in discussions about the development of the state. Its members, from a variety of walks of life, will meet four times a year to discuss and prepare public policies aimed at improving social and economic conditions within the state.

CEREIAS turns 16

The company commemorated the 16^th birthday of the Center for the Reintroduction of Wild Animals (CEREIAS), a partnership between Fibria, IBAMA (Brazilian Institute for the Environment and Renewable Natural Resources) and some of its suppliers in the state of Espírito Santo, with a special event. In order to encourage support for the project, a presentation was made for the partner companies demonstrating the results obtained at CEREIAS over its 16 years of existence. The partners also were given a tour of the facilities. CEREIAS, which has already taken into its care more than 73,000 animals, is located near the Aracruz Unit’s pulp mill.

A gathering of beekeepers

In partnership with the Agribusiness Center Foundation (CENAG) and the Brazilian Beekeeping Confederation (CBA), on February 19^th Fibria held the Apiculture Gathering – New Challenges event about the sustainable production of honey and its by-products side-by-side with eucalyptus plantations. Held at the company’s Center for Environmental Education (NEA) in Capão do Leão (Rio Grande do Sul State), the event attracted farmers and beekeepers from Uruguay, Argentina and a number of southern Brazilian locations.

Voluntary solidarity

Fibria’s commercial team in the USA and KSR paper distributor based in Recife (Pernambuco State) joined together to help victims of the earthquake in Haiti. Involving a number of different actions conducted in the second half of January, funds earmarked for the purchase of mineral water, non-perishable foods and medical supplies were donated. In addition to the help for Haiti, professionals from Fibria’s forest (Vale do Paraíba and Capão Bonito) and industrial (Jacareí and Piracicaba) units in São Paulo State collected food, cleaning products, clothes and furniture for the inhabitants of the historical municipality of São Luiz do Paraitinga, an area hard hit by floods in the beginning of January. During the days following the flooding, 50 of the company’s own and outsourced workers assisted the local fire brigade in cleaning the municipal schools used to shelter the people made homeless by the natural disaster. Fibria donated 10,000 liters of water and made a water truck available to help in the clean-up operation.

Centralized address

Fibria’s administration has been centralized at Alameda Santos, 1357 – CEP 01419-908 – São Paulo – SP – Brazil since the last week in February. The company’s corporate areas, including the CEO’s and directors’ offices, occupy six floors of the Edifício Itaú (Itaú Building). Our other São Paulo offices, on Avenida Faria Lima, have been closed down. The new office telephone number is (++55-11) 2138-4000.

Did you know...

...that the first commercial planting of trees in Brazil, in the early 20^th century, was aimed at satisfying the country’s increasing demand for wood? Some exotic species were included among those selected, including the eucalyptus tree, which grows more quickly than the native species. This tree, which originated in Australia, became Brazil’s most widely cultivated variety because it adapted so well to local conditions, was extremely versatile and provided a good economic return.
Source: The Value of the Forests, by Marco Antonio Fujihara and co-authors.