Klabin (KLBN4) Q2 2024 earnings summary

Executive summary

• Q2 2024 delivered strong business performance across all segments, driven by effective commercial strategies, diversified product portfolio, and ramp-up of new machines (PM27, PM28, Figueira), with sales volume reaching 995k tons, up 16% year-over-year.

• Adjusted EBITDA reached R$2.052 billion in 2Q24, up 53% year-over-year and 24% sequentially, with margin expanding to 41%.

• Net revenue rose 15% year-over-year to R$4.95 billion, driven by higher sales volumes, improved pricing, and favorable FX.

• Net income was R$315 million, down 68% from 2Q23, mainly due to higher financial expenses and FX impacts.

• Logistics bottlenecks, particularly in container exports, limited additional production and shipments, but recovery is expected in Q3.

Financial highlights

• Net revenue reached R$4.95 billion in Q2 2024, up 15% year-over-year, mainly due to higher sales volume, increased hardwood pulp prices, and BRL appreciation.

• Adjusted EBITDA was R$2.052 billion, with a margin of 41%, a 10 percentage point improvement over Q2 2023.

• Total cash cost per ton dropped to R$2,890, down 11% year-over-year and 3% sequentially.

• Net debt stood at R$23.8 billion as of June 30, 2024, up due to FX effects, with Net Debt/EBITDA (USD) at 3.2x.

• Dividend payment of R$410 million approved, with a 12-month dividend yield of 5.7%.

Outlook and guidance

• Q3 market perception is more cautious, especially regarding China, but higher shipment volumes are expected due to inventory carryover and strategic geographic focus.

• Positive demand and price trends expected for short fiber pulp, coated boards, and corrugated boxes; neutral to negative for long fiber/fluff, kraftliner, and industrial bags.

• Maintenance stoppages are scheduled for 3Q24 at key units, impacting sales volume.

• No new M&A or major capital projects planned; focus remains on deleveraging and maximizing returns from recent investments.