São Paulo, October 24th, 2024. Suzano S.A. (B3:SUZB5 | NYSE: SUZ), one of the world’s largest integrated pulp and paper producers, announces today its consolidated results for the third quarter of 2024 (3Q24).
HIGHLIGHTS
- Pulp sales of 2,635 thousand tons (6% vs. 3Q23).
- Paper sales1 of 360 thousand tons (9% vs. 3Q23).
- Adjusted EBITDA2 and Operating cash generation3 : R$6.5 billion and R$4.4 billion, respectively.
- Adjusted EBITDA2 /ton from pulp of R$2,162/ton (85% vs. 3Q23).
- Adjusted EBITDA2 /ton from paper of R$2,294/ton (-3% vs. 3Q23).
- Average net pulp price in export market: US$670/ton (23% vs. 3Q23).
- Average net paper price1 of R$6,866/ton (-3% vs. 3Q23).
- Pulp cash cost ex-downtime of R$863/ton (0% vs. 3Q23).
- Leverage of 3.1 times in USD and 3.2 times in BRL.
- Completion of the acquisition of minority stake in Lenzing, and land and forestry assets.
EXECUTIVE SUMMARY
The most challenging scenario ever observed in the Chinese pulp market at the end of the previous quarter worsened during the third quarter of 2024, adversely affecting the realized prices in the segment. The quarter was also marked by the appreciation of the average USD against the average BRL and the increase in sales volume, contributing to the increase in net revenue. Additionally, operational performance remained in line with the plan, with cash cost of production (excluding the effect of scheduled maintenance downtimes) slightly higher than in the previous quarter, partly due to the exchange rate effect. This combination of factors resulted in an adjusted EBITDA from pulp slightly higher than in 2Q24 (+3%). At the paper business unit, sales volume increased chiefly due to seasonality and allocation strategy between markets and segments, while prices remained practically stable (+1%). As such, consolidated adjusted EBITDA in the quarter totaled R$6.5 billion, while operating cash flow reached R$4.4 billion.
As for financial management, net debt in USD stood at US$12.9 billion, in a quarter marked by significant investments aimed at generating significant and sustainable value in the long term. Leverage in USD, on the other hand, experienced another decline to 3.1 times, which is explained by the increase in Adjusted EBITDA in the last 12 months. The foreign exchange hedging policy continued to play its part, with the operational cash flow hedge presenting a positive cash inflow of R$0.1 billion, despite a further depreciation of the average BRL in the period.
In line with the advances in its strategy, under the "Being an important player in pulp" and "Being the best in class in the total pulp cost vision," the new Ribas do Rio Pardo Unit, which began operations on July 21st, has demonstrated efficiency beyond expectations in the progression of the learning curve and has already contributed to the reduction of the consolidated cash cost in 3Q24. The previously disclosed estimates on the production volume of the new mill remain valid, with the ramp-up expected to be completed in 9 months, approximately 900 thousand tons expected in 2024, reaching 2.0 million tons by the end of 12 months of operations. Finally, regarding the financial execution of the project, the Company has completed about 93% of the total capex disbursement, with R$1.5 billion remaining to be paid between 4Q24 and 2025.
Source: Suzano