EMPRESAS CMPC PRESENT ESENTATION TION PREP EPARED ARED FOR ITAU U 10 TH TH ANNUAL L LATAM AM CEO CONFER FERENCE NCE – NY NY LUIS S LLANOS NOS – CFO TRINI INIDAD AD VALDÉS DÉS – HEAD D IR
AGENDA I. I. Compan pany descri cripti ption on II. Our value proposal 1. Leading diversified Latin American P&P player 2. Low cost producer with world class assets 3. Strong balance sheet and financial track record 4. Committed to Sustainable Development and Corporate Governance 5. Investment portfolio in high growth potential businesses III. 2015 Challenges IV. Appendix
CMPC AT A GLANCE CMPC is a P&P company, established in 1920, that produces soli lid d wood od CMPC’s Figures pro roducts ucts , pulp lp , paper, packagi kaging ng pro roducts ucts and tis issue sue in Latin in Sales: 4,831 EBITDA: 974 Ameri rica ca Net Income: 15 Net Debt: 3,494 Assets: 14,861 Figures for the LTM as of March 2015 (US$ million) International rating Market capitalization of US$7 bil illi lion n Controlled by the Matte e Family ly , one BBB+ BBB+ (Fitch) of Chile’s leading economic groups as of April 30 th , 2015 BBB BBB- (S&P) Baa3 (Moodys) P&P P main in compa ompanies by by mark rket t Shareholders’ Structure* Local rating capi pital taliz izati ation AA AA (Fitch) AA AA (ICR) 22.7 Chilean Pension Funds 17.9 11% Operations in 8 8 Local & count ntrie ries , selling to Foreign Matte Group 8.3 Investors 56% 7.8 7.0 6.9 33% more than 45 count ntri ries es 5.9 5.6 ~16,800 IP IP SCA Stora ra Fibria CMPC KCM Klabin Suza zano Employees worldwide Enso * As of March 31 st , 2015. Source: CMPC *As of April 30 th , 2015. Source: Bloomberg 3
AGENDA I. Company description II. II. Our value lue pro ropos osal al 1. 1. Leading ding dive versifi sified ed Latin n American rican P&P player er 2. 2. Low ow cost pro roducer cer with h wo world class s assets ts 3. 3. St Stro rong g balance ance sheet t and d fin financi ncial al track k record 4. 4. Committ mitted ed to Sustai taina nable ble Deve velopment pment and Corp rporat ate e Gove vernance nance 5. 5. Inve vestm stment ent portfolio in high gh gro rowth th pot otent ntial al busines nesses ses III. 2015 Challenges IV. Appendix
1. . LEA EADING DING DI DIVE VERSIFIED SIFIED LATIN TIN AME MERIC ICAN AN P&P PLAYER
A DIVERSIFIED BUSINESS PORTFOLIO PROVIDES CMPC A STABLE CASH FLOW % of third par arties es total al % of cons nsolidat ated ed Total al cap apac acity & Main n Figures es sales es EBITDA DA Employee ees 659 Th. has. planted Sales: 931 estry 12.9 M m 3 /y harvested Sales 3 rd parties: 588 Forest 15% 15% 12% 1.7 M m 3 /y solid wood EBITDA: 145 2,615 employees EBITDA margin: 16% US$5.8 billion in assets Sales: 1,768 2.8 M tons/y Pulp Sales 3 rd parties: 1,413 29% 29% 48% 48% 2,155 employees EBITDA: 470 US$4.3 billion in assets EBITDA margin: 27% Sales: 1,035 1.3 M tons/y ers Sales 3 rd parties: 980 Paper 20% 20% 16% 16% 3,639 employees EBITDA: 153 US$1.6 billion in assets EBITDA margin: 15% Sales: 1,852 617 Th. tons/y sue Sales 3 rd parties: 1,849 Tissu 39% 39% 22% 22% 8,234 employees EBITDA: 214 US$2.2 billion in assets EBITDA margin: 12% Source: CMPC. Figures in US$ million for the LTM as of March 2015 / Figures do not include sales between CMPC affiliates or subsidiaries 6
CMPC HAS EVOLVED FROM A LOCAL COMPANY TO A GLOBAL PLAYER CMPC has expande nded d signi nifi ficant antly y through Latin n Amer erica a over the last two decades 11x asset t gro rowth th since 1990 (before CMPC’s international expansion process) Sales Bre reak akdo down n Evolut ution n (Million n US$) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 Forestry Operations Pulp Operations 0 Paper and Packaging Operations Tissue Operations Domestic Sales in Chile Export Sales Domestic Sales Foreign Subsidiaries 7 Source: CMPC
CMPC HAS A PRODUCT AND GEOGRAPHIC DIVERSIFICATION OF SALES THAT PROVIDES FLEXIBILITY Operations in 8 8 count ntri ries es , selling in more than 45 count ntri ries es Plywood 10 la 10 largest est custome omers represent ~ 15% of consolidated sales Besides Chile, there is no sin ingle e count ntry that represents more e than 15% 15% of consolidated sales 8 Source: CMPC. Figures in US$ million for the LTM as of March 2015 / Figures do not include Holding and Intercompany Sales.
2. . LOW COS OST PROD ODUCER UCER WIT ITH H WOR ORLD D CLASS SS ASS SSETS
CMPC BENEFITS FROM ITS PRODUCTION COST EFFICIENCIES AND WORLD CLASS ASSETS Researc arch h and Access to Deve velopment pment low ow cost fib fiber to enhance efficiency, productivity and customer satisfaction Energy gy investments based in biomass mass and St State e of a art cogenerati neration facilities strateg egical cally y (energy self-sufficiency in located ed Chile by mid 2015) 10
HIGH YIELD FORESTRY ASSETS THAT PROVIDE LOW COST FIBER RESOURCES 658,800 Plante ted d hecta tares 490,300 300 CMPC Forest Base Chile is FSC TM 112,00 ,000 0 Certified Brazi zil * 56,500 00 Ove ver r 1 mil illion ion hecta tare res s of la land Argent ntina CMPC has a high quality and sustainable forestry base with fast growth cycles which optimizes capital invested in land, reduces average distance to mills and increases gains due to genetic and sylvicultural practices Improveme ement t in in Forestr restry y Yie ields s ** Radiata ata Pin ine Euca ucalyp yptu tus Average softwood growth rate Average hardwood growth rate 32% 32% (m 3 ssc/ha/year) (m 3 ssc/ha/year) 23% 23% 43 43 43 43 14% 14% 23 23 20 20 19 19 9% 9% 11 11 11 11 3% 3% 5 4 0% 0% 2 E. Globulus E. Globulus Mangium Eucalyptus E. Nitens Chile 1975 1980 1990 2000 2010 2020P Russia Scandinavia Canada USA Chile Acacia Iberian Brazil Chile ** Evolution of the weighted increase of volume per hectare excepted for eucalyptus and pine plantations established in Chile in the respective year Source: CMPC. 11 *There is an agreement to acquire from Fibria aprox. 100 Th. hectares of which 39 Th. are planted. CMPC is waiting the approval of Brazilian authorities to consolidate this land ** m 3 ssc: solid m 3 without bark
CMPC’S CASH COSTS ARE AMONG THE LOWEST OF THE PULP INDUSTRY GLOBALLY CMPC’s average distance from… to… Ports ts Pla lanta tatio tions Laja ja 93 Km. m. 80 Km. m. (by train) in) BSKP KP – 340 th. tons 80 Km. Guaíb íba I 260 Km. (by y barge rges) s) BEKP KP – 455 th. tons 93 Km. m. Pacíf ífico ico 163 Km. (by y train) BSKP KP – 500 th. tons Santa ta Fe 119 Km. m. 99 Km. m. (by y train) BEKP KP – 1.500 th. tons Source: CMPC BSKP KP 1 Supp pply Cur urve (US$/t /ton) on) BHKP KP 2 Suppl pply y Curve e (US$/t /ton) on) Effective price range of CMPC’s BSKP, last 24 months 700 700 Effective price range of CMPC’s BHKP, last 24 months 700 700 600 600 600 600 (US$/Ton c.i.f. N. Europe) (US$/Ton c.i.f. N. Europe) 500 500 500 500 400 400 400 400 CMPC’s pulp facilities 300 300 300 300 200 200 200 200 CMPC’s pulp facilities 100 100 100 100 0 0 0 5,000 10,000 15,000 20,000 25,000 0 5,000 10,000 15,000 20,000 25,000 30,000 (Thousand m metri ric t tonnes) (Thousan sand metric tonne nes) s) Source: CMPC and Hawkins Wright as of April 2015 (1) BSKP: Bleached Softwood Kraft Pulp 12 (2) BHKP: Bleached Hardwood Kraft Pulp
CMPC IS FOCUSING ON ENERGY EFFICIENCY AND RENEWABLE ENERGY SOURCES CMPC is constantly investing in energy generation based on biomass and cogeneration to further lower its cost base and its dependency from the electric market Curr rrent t Cogenerati eneration Proj roject ects Puente Alto Mill (3Q15): 50MW + 80 tons steam/hour Talagante Mill (3Q15): 21MW + 25 tons steam/hour Altamira Mill (3Q15): 21MW + 30 tons steam/hour Sourc rce e of En Energy gy Consum umpt ption on Energy gy Balance ance in Chile e GWh Plywood in CMPC Consu sumpt mption on Generati ration on 2013 (89,9 ,975 Teraj ajoul oules) 3,500 Coal Natural 6% 3,000 Gas Oil 7% 2,500 6% Electric 2,000 Energy 1,500 8% 1,000 Biomass 500 73% 0 2014 F 2015 F 2016 F 2014 F 2015 F 2016 F Generation Contracts Forestry Pulp Papers Tissue Source: CMPC 13
3. . ST STRONG ONG BA BALANCE ANCE SH SHEE EET AND ND FI FINANC NANCIAL IAL TRACK CK RECORD ORD
KEY FINANCIAL FIGURES AS OF MARCH 31 ST 2015 Sale les s Evol volution tion (US$ mil illion on) EBITD ITDA and EBITD ITDA Marg rgin Evol volutio tion (US$ mil illion) on) 1, 200 1,066 50% 4,974 985 974 4,900 964 4,831 4,786 45% 4,759 914 1, 000 40% 35% 800 30% 22% 20% 20% 19% 19% 600 25% 20% 400 15% 10% 200 5% Plywood 0 0% 2011 2012 2013 2014 LTM 2011 2012 2013 2014 LTM Source: CMPC Source: CMPC Fin inancial Debt bt / Equity ty (Covenan enant: : <0.8x) Interest rest Cov overa erage e Ratio o (Covenant: : >3.25 .25x) 0.56x 0. 60 0.53x 8. 00x 0.48x 0.48x 6.80x 50 0. 0.43x 7. 00x 5.67x 5.45x 5.31x 5.18x 6. 00x 0. 40 5. 00x 30 0. 4. 00x 3. 00x 0. 20 2. 00x 10 0. 1. 00x 0. 00x 0. 00 2011 2012 2013 2014 1Q15 2011 2012 2013 2014 1Q15 Source: CMPC Source: CMPC 15
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