São Paulo, May 4, 2020 – Klabin, Brazil’s largest packaging paper producer and exporter, the country’s only producer to offer solutions in hardwood, softwood and fluff pulp and the leading producer of corrugated board packaging and industrial bags, has reported 2% growth in adjusted EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) in the first quarter of 2020 compared to the same period last year, which reached R$1.028 billion.

 

 

Total sales volume in 1Q20 was 849,000 tons, 8% higher than in the same period in 2019. The main factors behind the solid performance during the period were the 15% growth in sales of paperboard, which is used in the production of boxes to package milk, juices and other beverages, and the increase in demand for packaging for basic necessities, especially in the food and beverages, cleaning products, and personal and hospital hygiene segments. Sales of packaging (corrugated board and industrial bags) followed the upward trend of recent quarters, with sales volume in 1Q20 growing 5% from 1Q19.

 

 

In 1Q20, net revenue grew 4% from 1Q19 to reach R$2.591 billion, driven by the healthy sales performance by all business units of the Company and the exchange variation in the period, due to the volume dedicated to exports. The result once again underscores the operational efficiency, flexibility and diversification of the Company’s products and markets.

 

 

In the first quarter, Klabin also announced the acquisition of the packaging paper and corrugated board packaging business from International Paper in Brazil. The transaction, which was submitted to the Brazilian antitrust authority CADE, is aligned with the Company’s growth strategy and consolidates its leadership position in the sector.

 

 

Investments       

 

In the first quarter, Klabin invested R$820 million, of which R$72 million went to its forestry operations, R$198 million to ensure operational continuity and maintenance of plants, and R$23 million to special and expansion projects. In addition, investments in the Puma II Project totaled R$527 million in the quarter.

 

 

Combating the new coronavirus

 

 Since the onset of the pandemic, Klabin has taken a series of preventive measures to help combat the spread of the new coronavirus among its employees and communities. Crisis Committees have been assessing daily the best practices, in line with the guidelines of the World Health Organization (WHO), to guarantee the safety and well-being of everyone and the maintenance of operational activities.

 

Over 80% of Klabin’s pulp, paper and packaging production is earmarked for the food (fresh and processed food), hygiene (toilet paper, tissues and toothpaste, among others) and cleaning (washing powder and soap, for example) segments, which are considered basic necessities for the population. The Company is also Brazil’s only producer of fluff pulp, which is an essential raw material for the production of disposable adult and child diapers. In Brazil alone, the company is responsible for 50% of the market supply.

 

 

Donations

 

Aware of its important role in combating COVID-19, Klabin allocated R$10 million to health and social assistance initiatives, giving priority to protective measures in the communities in regions where it operates.

 

Financial highlights