SUZANO S A/ADR (NYSE:SUZ) Q3 2019 Earnings Conference Call - Final Transcript

Nov 01, 2019 • 09:00 am ET


SUZANO S A/ADR (NYSE:SUZ) Q3 2019 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for holding, and welcome to Suzano's Conference Call to discuss Results for the Third Quarter of 2019. [Operator Instructions] During the presentation of Messrs. Walter Schalka, Chief Executive Officer, Marcelo Bacci, Financial [Technical Issues] Leonardo Grimaldi [Phonetic], Paper Executive Officer. After the company's remarks are completed, there will be a question-and-answer session when further instructions will be given. [Operator Instructions] Before proceeding, please be aware that any forward-looking statements are based on the beliefs and assumptions of Suzano's management and on information currently available to the company.

They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. You should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Suzano, and could cause results to the differ materially from those expressed in such forward-looking statements.

Now I would like to turn the floor over to Mr. Walter Schalka. Please, Mr. Walter Schalka, you may proceed.

Walter Schalka

Good morning, everyone. It's a great pleasure to have you joining us with the third quarter results of Suzano. I think I'd like to -- In addition, to the name that there was mentioned to us we have Pablo Machado, we have been Fernando Bertolucci. We have Christian Orglmeister and Alexandre Chueri, and we have [Indecipherable] as well. We are here to answer in the end of the presentation all the required questions.

I think the highlights of this quarter is very positive. We are very pleased with the operational performance, but of course, we are a little bit frustrated not delivering them as return to our shareholders. Due to the lower pulp prices that we have been taking on the last month. I think I'd like to highlight some specific points to you. The first of all is the sales volumes that was -- on the pulp side 2.5 million ton, 15% higher than the previous quarters.

The sales volumes on paper, that is 288,000 ton [Phonetic], that is showing our flexibility. I think, the local market is not performing as expected, we increased our exports on this quarter.

On the results of that, we have an EBITDA of BRL2.4 billion and a free cash flow of BRL1.5 billion. Even on this more asset -- market scenario, we are delivering cash flow return and decreasing our leverage. In addition to that, I think it's very important to highlight our pulp reduction on inventory. We had roughly 450,000 tons on reduction and we will continue to reduce this number on the fourth quarter. We announcing today that our net debt is, even on this scenario, have been going down from USD13.7 billion to put USD13.3 billion on this quarter, and since our EBITDA on the last 12 months is going down due to the lower pulp prices, our leverage is 4.3 times and we are going to announce today. Marcelo Bacci is going to go in more