Our Economic Performance
Sustainable Development Goals
Material Aspects

A green bond – such as the one issued by Fibria in January 2017 – was designed to fund projects and assets that have positive impacts on the environment and on climate. Thus, through the green bond, companies, investment banks, and governments raise funds to implement or refinance projects or assets with positive environmental or climate impacts. The bonds may take the form of any debt securities – such as debentures, notes, and financial bills. The only difference is the destination of the resources.

Green bonds attract investors who take social and environmental factors into account in their decisions, known as Socially Responsible Investors (SRI). In Fibria’s case, 40% of the investors who bought the green bond were SRIs.

The next section contains more information on this issuance, which is in line with our long-term sustainability goals and the company’s economic performance in 2017.

Economic Management

The year 2017 was good for Fibria, and may be summarized in several points: significant increase in production, record sales, lower costs, and a significant reduction in leverage. Supported by increased production capacity, as a result of the start-up of the second production line in Três Lagoas (Mato Grosso do Sul state), and by a heated global pulp market, these results reinforced our financial soundness, as evidenced by the improved credit conditions and the investment grade assigned to Fibria by two international rating agencies.

Safe Investment

At the end of 2017, Fibria’s BBB- rating was confirmed by the rating agencies Standard & Poor’s (S&P) and Fitch. The confirmation was accompanied by an improvement in the company’s outlook, according to ratings from both agencies: S&P changed Fibria’s outlook from Negative to Stable, and Fitch made the change from Stable to Positive. The changes, in both cases, maintain Fibria’s assessment within the Investment Grade.


  • Production: Fibria produced 5,642 million tons* of pulp in the year, a growth of 12% over 2016. In order to reach this result, the second mill in Três Lagoas recorded production of 559,000 tons – 17% more than planned for the initial period of operation in 2017, representing a solid measure of the advance in the learning curve of the new line. The operational stability, maintained throughout the year by the other production units, also contributed to this result.

*Includes 50% of Veracel’s pulp production

The second production line in Três Lagoas, which began operation in August 2017, produced 435,000 tons of pulp in the fourth quarter of the year. The result contributed to a total production of

1.659 million tons in the

fourth quarter of 2017 – an increase of 36% over the fourth quarter of 2016.

  • Sales: in 2017, we sold 6.212 million tons of pulp, 13% above the total volume sold in 2016, including the Klabin production sold by Fibria. Sales growth, coupled with higher prices in dollars, resulted in net revenue of BRL 11.739 billion for the year – 22% higher than 2016.

In the final three months of 2017, Fibria sold the largest volume ever marketed in a quarter in the company’s history: 1.897 million tons of pulp, 20% more than the same period in 2016. Net revenue in the period of BRL

4.047 billion

was 60% higher than in the final quarter of 2016.

Wood yard in Aracruz (Espírito Santo state)
Photo: Marcio Schimming

  • Cash cost: our production cash cost in 2017 had a reduction of 6% compared with the previous year. Some factors explain this improvement: a minor impact of scheduled shutdowns for maintenance; better result obtained in energy sales; the shortening of the average radius (smaller distance from the forest to the mill), and a reduction in fixed costs.

The new Três Lagoas (Mato Grosso do Sul state) mill accounted for


of all excess energy generated and marketed in the fourth quarter of 2017

  • EBITDA and net income: the combination of factors such as increased production and sales, reduced costs, and a favorable price and exchange environment led Fibria’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) to reach BRL 4.952 billion, with a margin of 49% (in 2016, the result was BRL 3.742 billion). The company had a net profit of BRL 1.093 billion in the year (34% below the BRL 1.664 billion obtained in 2016, partly due to the accounting effect of the exchange rate variation); the free cash flow was BRL 2.025 billion. The result allowed management to propose dividends to shareholders of BRL 258 million.
  • Leverage: the increase in EBITDA in 2017 led to a rapid decline in the ratio between net debt and EBITDA in dollars – that is, the company’s financial leverage (the capacity, measured in 12 months, that it has to pay its debts with the generation of operating cash). This indicator dropped from 3.30 times in the last quarter of 2016 to 2.41 times in the last quarter of 2017. Fibria ended the year with cash at BRL 6.968 billion.

Fibria’s policy establishes that, at the time of investment, the value of the company’s leverage indicator may reach a maximum of 3.5 times. Thus, the reduction of the indicator to


when there are still disbursements related to the second production line in Três Lagoas is a demonstration of the company’s discipline concerning its commitments.

Photo: Araquém Alcântara


Following the issue of our first green bond in January 2017, debt securities in the amount of USD 700 million to finance projects to maintain planted forests, conserve protected forests, and restore degraded areas, Fibria carried out a new issue on the global market. This time, conventional securities in the amount of USD 600 million, maturing in seven years and a coupon of 4% per year.

This financial strategy, supported by other operations, such as the first-time issue of Agribusiness Receivables Certificates (CRA – Certificados de Recebíveis do Agronegócio), will allow the average term of the company’s debt to be extended by one year, maintaining a low average cost. In this way, we will be able to accelerate our deleveraging, supporting a financial soundness that will allow us great flexibility in capital allocation in the near future.


2015 2016 2017
Net revenue from sales (BRL million) 10,081 9,615 11,739
Net income (BRL million) 357 1,664 1,093
Assets (BRL million) 29,434 34,440 38,693
Net equity (BRL million) 12,815 13,818 14,650
EBITDA (BRL million) 5,337 3,742 4,952
Net Debt /EBITDA UDM (USD) 1.78 3.30 2.41
Pulp production (thousand tons) 5,185 5,021 5,642
Pulp sales (thousand tons) 5,118 5,504 6,212
Market cap (BRL billion) 28.7 17.7 26.5
Production cash cost (BRL/ton) 618 680 637
Price of shares – FIBR3 (BRL) 51.9 31.9 47.9


Consolidated (in thousand reais) 2015 2016 2017
Gross sales of products and services (less returns) 10,281,877 9,838,796 12,006,228
Write-back (provision) for deterioration of credits receivable 1,645 470 325
Revenue associated with the construction of own assets and other 1,719,194 2,689,336 3,191,739
12,002,716 12,528,602 15,198,292
Inputs acquired from third parties
Cost of products and services sold (includes raw materials) (4,819,669) (7,201,273) (8,449,466)
Materials, energy, third-party services, and other (533,212) (579,661) (647,354)
(5,352,881) (7,780,934) (9,096,820)
Gross value added 6,649,835 4,747,668 6,101,472
Depreciation, amortization, and depletion (1,827,097) (1,922,741) (2,149,305)
Depletion of wood from partnership operations (65,141) (60,702) (55,692)
(1,892,238) (1,983,443) (2,204,997)
Net value added 4,757,597 2,764,225 3,896,475
Value added received in transfer
Results of equity accounting 393 (751) 49
Financial revenue and active exchange variations 1,701,679 4,351,159 2,249,931
Deferred income tax and social insurance contribution 1,202,172 0
2,904,244 4,350,408 2,249,980
Total value added for distribution 7,661,841 7,114,633 6,146,455
Value added distribution
People and payroll charges 727,641 752,912 880,530
Direct remuneration 565,250 563,390 655,748
Benefits 133,627 156,561 185,657
Government Severance Indemnity Fund (FGTS) 28,764 32,961 39,125
Taxes, fees and contributions 1,051,439 1,798,405 952,455
Federal 899,655 1,634,163 750,794
State 115,740 123,394 155,073
Municipal 36,044 40,848 46,588
Accrued interest, passive exchange variation and leases 5,525,776 2,899,700 3,220,126
Dividends 81,269 393,026 257,750
Retained profit (loss in the period) 260,916 1,261,822 827,515
Interests of noncontrolling shareholders 14,800 8,768 8,079
Value added distributed 7,661,841 7,114,633 6,146,455