3Q10 Results

November 12th, 2010

Highlights
Slide 2

Sales volume excluding wood: + 17% over 9M09;

Net revenue: + 27% over 9M09;

Operating cash flow (or EBITDA): + 38% over 9M09;

Net debt: - 27% (or R$ 570 million reduction) compared

to December 2009;

Net Debt/EBITDA ratio fell to 2.2x in September 2010,

down from 3.7x in December 2009 and 5.3x on March 2009.

Sales volume
Slide 3
17%

1,299

1,109
3%

421

409

430

436

165

129

128

269

301

308

1Q10

2Q10

3Q10

433

Domestic Market

25%

878
700

9M09
Exports

* Excluding wood volume.

Note: Some figures in this table may not express an accurate result due to rounding.

9M10

Net revenue
Slide 4
27%

2,732

612
2,155

14%

539

844
215

905
193

31%

983
204

630

712

779

1Q10

2Q10

3Q10
Domestic Market

2,120

1,616

9M09
Exports

Total

* Including wood.
Note: Some figures in this table may not express an accurate result due to rounding.

9M10

Kraftliner prices
Slide 5
Kraftliner Brown 175 g/m List Price
(/tonne and R$/tonne)

1,393

1,459

1,356
1,344

1,392
1,302
1,217

1,207

1,162
1,029

1,038

1,079

1,089

529
524

516

501

486
487

3Q07

4Q07

1Q08

Source: FOEX and BAC EN

2Q08

3Q08

385
462

4Q08

Quarter average

404

433

4Q09

1Q10

478

533

411

1Q09

2Q09

3Q09

Kraftliner ( / tonne)

2Q10

3Q10

Kraftliner (R$ / tonne)

Unitary cash cost (R$/tonne)

Slide 6
+3%

1.538

1.493

287

333

449

409

751

802

9M09

9M10

Variable costs

Fixed Costs

SG&A

EBITDA and net income

300

27%

27%

29%
26%

26%

250

30.0%
25.0%

242
200

199

219

236

252
20.0%

150

15.0%

100

10.0%

50

5.0%

0.0%

250

3Q09

4Q09

1Q10

2Q10

200

3Q10
226

150
100

125

50

42

0
-50

3T09

4T09

1T10

67
2T10

3T10

-100
-150

(223)

-200
-250

EBITDA

EBITDA Margin

Net income (loss)

Slide 7

Working Capital (R$ million)

Slide 8

Reduction in working capital requirements of R$ 210 million in 9M10.

1.900
1.800
1.700
1.600
1.500
1.400
1.300
1.200
1.100
1.000
900
800
700
600
500
400
300
200
100
0

38%
34%

40%

37%

26%
1,174
1,013

30%

23%

21%

1,108

16%
782

20%

10%

714

680

573
0%

-10%

1Q09

2Q09

3Q09

4Q09

Operating Working Capital (OWC)

1Q10

2Q10

3Q10

OWC / Net Revenue

Cash and indebtedness

Slide 9

Net Debt
(R$ million)

12/31/09

Local currency

329

7%

492

10%

Foreign currency

366

8%

310

7%

Long term

4,142

86%

3,926

83%

Local currency

1,671

35%

1,683

36%

Foreign currency

2,471

51%

2,243

47%

Gross debt

4,837

100%

4,728

Local currency total

2,000

41%

2,175

46%

Foreign currency total

2,837

59%

2,553

54%

Cash

2,731

2,052

500

Net debt

2,106

2,676

-500

Net debt / EBITDA (LTM)

2.2 x

3.6 x

LTM - last twelve months

5500

5.3
4.4

4500
3500

100% 2500

1500

3.7

3.6

3.1

2.8

2.2
2,106

17%

2,462

802

2,528

14%

2,676

695

2,886

Short term

3,192

09/30/10

3,786

Debt (R$ million)

Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10

Net Debt
Net Debt / EBITDA (LTM)

6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.
-1.
-1.
-2.

Strategy
Slide 9

Investment in amount of R$ 100 million in the corrugated boxes

conversion mills;

New biomass boiler installation in Correia Pinto to replace the current

fuel oil consumption;

Investments planned for 2010 total approximately R$ 350 million;

Focus in rapid return investments and in reduction of Net Debt /

EBITDA Ratio, preparing the Company for the capex that will take place in
2015/16;

Studies for installation of a new pulp line with capacity of between 1.3
and 1.5 million t/year and a coated board machine with capacity of
between 400,000 and 500,000 t/year.

Investor relations:
Phone: (+55 11) 3046-8404 / 8415 / 8416
www.klabin.com.br
invest@klabin.com.br