Klabin (KLBN4) Q3 2025 earnings summary

Executive summary

• Net revenue reached R$5.4 billion in 3Q25, up 9% year-over-year, with Adjusted EBITDA of R$2.1 billion, a 17% increase, and EBITDA margin at 39–40%, driven by strong packaging and paper segments despite weak pulp prices.

• Sales volumes increased: pulp up 25%, paper up 10%, packaging up 7% year-over-year, with corrugated boxes and industrial bags showing notable gains.

• Free cash flow for the quarter was R$699 million, with a last twelve months yield of 12.6%, and liquidity at R$9.7 billion.

• The company is transitioning from a heavy investment phase to a focus on free cash flow generation, deleveraging, and operational efficiency.

• ROIC improved to 11.4%, up 0.4 p.p. year-over-year, reflecting EBITDA growth.

Financial highlights

• Net debt stood at R$26.1 billion as of 09/30/2025, with Net Debt/EBITDA at 3.6x (USD), down 0.3x from 2Q25.

• Total cash cost per ton was R$3,104, a 2% decrease both sequentially and year-over-year.

• Dividend yield over the last twelve months was 5.5–6.2%, with R$1.3 billion distributed and R$318 million approved for November.

• CAPEX for 3Q25 was R$554 million, down 28% YoY, reflecting the end of major expansion projects.

• Free cash flow yield for the last twelve months was 12.6%.

Outlook and guidance

• CAPEX guidance for 2025 remains at R$3.3 billion, with stable investment lines and only marginal carryover into 2026.

• Management expects continued free cash flow generation, further deleveraging, and no major transformational investments ahead.

• Cost benefits from recent investments, such as the Monte Alegre boiler and CAITE Project, are expected to materialize in 2026.

• Guidance for production volumes in 2026 will depend on market conditions and fiber mix.

• Ongoing land monetization through the Caetê Project, with R$95 million in land sales in 3Q25 and ~20,000 hectares available for future sales.