Suzano reports operating cash generation of R$ 3.9 billion in the first quarter of 2022

Rhea-AI Summary

Suzano, a major player in the integrated pulp and paper sector, reported its first quarter 2022 results with an Adjusted EBITDA of R$ 5.1 billion, rising 5% year-over-year. Operating cash generation remained robust at R$ 3.9 billion. Despite facing increased input costs and a stronger Brazilian Real, the company plans to invest R$ 13.6 billion in production capacity this year. Net debt stabilized at USD 10.5 billion, with a debt-to-EBITDA ratio improving to 2.4 times. Pulp sales totaled 2.4 million tons, contributing to net revenue of R$ 9.7 billion.

Positive

• Adjusted EBITDA increased by 5% to R$ 5.1 billion.
• Operational cash generation remained stable at R$ 3.9 billion.
• Investment plans for 2022 total R$ 13.6 billion, indicating growth focus.
• Net debt remains stable at USD 10.5 billion despite increased investments.
• Debt-to-EBITDA ratio improved to 2.4 times from 3.8 times year-over-year.
• Pulp sales reached 2.4 million tons, indicating strong market demand.
• Net revenue from pulp and paper sales reached R$ 9.7 billion.

Negative

• Input costs, including chemicals and fuels, increased sharply.
• Pulp cash costs rose by 16% to R$ 868 per ton.

Result underlines company's robust financial strength despite a sharp increase in input costs and a strengthening of the Real

SÃO PAULO & NEW YORK--(BUSINESS WIRE)-- Suzano, one of the world’s largest integrated pulp and paper producers, announces its first quarter results for 2022 (1Q22) with Adjusted EBITDA reaching R$ 5.1 billion, up 5% on the same period last year. Operating cash generation, another important indicator of the company's financial performance, reached R$ 3.9 billion, consistent with levels seen this time last year.

Despite first quarter headwinds from rising input costs, such as chemicals and fuels, and an appreciating Brazilian Real, the company continues to invest in its production capacity with total disbursements of R$ 13.6 billion planned for 2022.

Suzano continues to maintain healthy levels of indebtedness and leverage, measured by the ratio of net debt to adjusted EBITDA which stood at 2.4 times (USD), an improvement on 3.8 times at this point last year. Net debt was almost stable during the quarter (USD 10.5 billion), despite the growth in investments and the dividend payment in January.

Pulp sales reached 2.4 million tons, driven by a higher concentration of scheduled downtimes at Suzano's mills in 1Q22. Pulp cash costs reached R$ 868 per ton, an increase of 16% on the last quarter of 2021. The company’s pulp inventory levels remained low due to strong demand in the quarter.

Paper sales totaled 312 thousand tons. Net revenue, including pulp and paper sales, amounted to R$ 9.7 billion.

“We had a quarter of consistent cash generation, despite higher input costs and the strengthening of the Real against the Dollar. These effects were partially mitigated by higher prices in the international market, not completely reflected in the results, and by the efficiency of our business model and the competence of our team on the operational and commercial fronts. We continue to positively advance our strategic priorities as expected, with continued ESG progress and the transformational Cerrado project remaining on time and on budget,” said Walter Schalka, CEO of Suzano, referring to the construction of a pulp mill in Ribas do Rio Pardo, Mato Grosso do Sul state.

The exchange variation during the first quarter of 2022 led the company to record a positive net result of R$ 10.3 billion on the bottom line of the balance sheet.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220504006278/en/

Hawthorn Advisors

Jamie Plotnek

suzano@hawthornadvisors.com

Source: Suzano

FAQ

What were Suzano's first quarter 2022 earnings?

Suzano reported an Adjusted EBITDA of R$ 5.1 billion for 1Q22.

How much did Suzano invest in 2022?

Suzano plans to invest R$ 13.6 billion in production capacity in 2022.

What is Suzano's current net debt?

Suzano's net debt stood at USD 10.5 billion as of 1Q22.

What was Suzano's net revenue for the first quarter of 2022?

The net revenue for 1Q22 amounted to R$ 9.7 billion.

How did Suzano's cash costs change in 1Q22?

Pulp cash costs increased by 16% to R$ 868 per ton in 1Q22.