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Corporate PresentationAugust 2019
Forward-Looking Statements
Investor Relations Contacts
Colomba Henríquez
+56 2 2441 2791
Petya Miteva
+56 2 24412713
Agustina Mussolini
+56 2 2441 2616
This presentation may contain forward-looking statements that
should be considered as good faith estimates. Such statements are
subject to risks and uncertainties outside of CMPC's control that
could cause CMPC’s actual results to differ materially from those
set forth in the forward-looking statements. These risks include in
particular those described in CMPC’s Financial Statements, Note 3
(“Risk Management”).
Forward-looking statements speak only as of the date they are
delivered. CMPC undertakes no obligation to publicly update or
revise them based on developments which differ from those
anticipated.
2
Index
I. CMPC at a Glance
II. Competitive Advantages
III. Industry Drivers
IV. Strategy
V. Appendix
3
CMPC at a Glance
4
73%
16%
11%
Pulp
Softys
Packaging
Assets
$14,892
A Global Leader in P&P
CMPC is a P&P company, established in
1920, that produces solid wood products,
pulp, paper and packaging products and
tissue in Latin America.
CMPC Figures 1
1 Source: CMPC. Figures for the LTM as of June 2019 (USD million)
2,3 Source: Hawkins Wright, RISI
4th
Global Market Producer 2
Pulp
5th
Global Producer
Paper Sacks
Investment Grade
CompanyFitch: BBB (stable)
Moody’s: Baa3 (positive)
S&P: BBB- (stable)
5
8%
87%
5%Softys
Pulp
Packaging
EBITDA
$1,570
52%
15%
33%
Sales
$6,053
Softys
Packaging
Pulp
2nd
Producer in LatAm 3
Tissue
1st
Largest LatAm Exporter
Boxboard
6Source: CMPC, as of December 2018
Vertically integrated...
tons / year
Pulp
tons / year
Recycled Paper
tons / year
HW 3,362,000
SW 798,000
688,000
Planted hectares
1.6 millionm3 / year
Solid Wood Products
Market Pulp
580,000
260,000
520,000
66,000
747,000
tons / year
Tissue Paper
Products
211,000tons / year
732 MMunits / year
396 MMunits / year
tons / year
Market Pulp
tons / year
Boxboard
Sackraft
Containerboard
Paper Sacks
Molded pulp trays
Corrugated boxes
m3 harvested
16.6 million
~90%
Source: CMPC. Figures in USD million for the LTM as of June, 2019 / Figures do not include Holding and Intercompany Sales
... and well-diversified player
7
CMPC’s Corporate Governance & Shareholders’ Structure
High corporate governance standards, in line with international best
practices to continue growing and generating value to all our stakeholders
in a responsible and sustainable way.
Shareholder’s Structure 1 Corporate Governance
1 Source: CMPC, as of June 30th, 2019
Chilean Pension FundsChilean
and Foreign Investors
Matte Group
10%
56%
34%
Each Board of Directors Committee counts with a functioning protocol which
defines its members, attributions and topics addressed.
8
Committed to Sustainable Development
Member of the
FTSE4Good Index
(5th consecutive year)
Energy Efficiency
Gold Seal
granted by the Energy
Ministry of Chile and
the Agency for Energy
Efficiency
First Chilean
Company to issue a
Green Bond
9
Member of the
DJSI Chile Index (4th
consecutive year) and
DJSI MILA Index (2nd
consecutive year).
Competitive Advantages
10
Forestry assets in low-cost, high-yield geographies with continuous productivity growth
Eucalyptus
Radiata Pine
Average hardwood growth rate (m3ssc/ha/year)
Average softwood growth rate (m3ssc/ha/year)
Eucalyptus Nitens
Radiata Pine
Volume Gain (%)1
Volume Gain (%)1
Source: CMPC1Achieved through continuous traditional genetic and silvicultural improvements.
11
20 23
43 43
E. Globulus
Iberian
E. Globulus
Chile
Acacia
Mangium
Eucalypus
Brazil
E. Nitens
Chile
24 5
11
20
Russia Scandinavia Canada USA Chile
1.4
8.2
19.0
27.2
1994-1996 1997-1999 2000-2014 2015-2017
06.0
15.1
25.8
35.7
1975 1976-1994 1995-2009 2010-2015 2016-2017
11
0
100
200
300
400
500
600
700
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000
0
100
200
300
400
500
600
700
0 5,000 10,000 15,000 20,000 25,000
Strategically located pulp facilities
12
BSKP Cash Cost
USD/ton cif China
Th. Metric Tons
BHKP Cash Cost
USD/ton cif China
Ca
sh C
ost
Th. Metric Tons
CMPC’s pulp facilities
Source: CMPC, Hawkins Wright April 2019
Ca
sh C
ost
CMPC’s pulp facilities
ColombiaTM1: 221G2: 4.3%
9%
3%
EcuadorTM1: 72G2: 4.8%
22%
8%
PerúTM1: 171G2: 7.1%
55%
24%
BrazilTM1: 1,243G2: 4.4%
12%
3%
ChileTM1: 233G2: 5.2%
70%
31%
CMPC’s Tissue paper market share
CMPC’s baby diaperpaper market share
41%
16%
ArgentinaTM1: 327G2: 3.5%
80%
57%
UruguayTM1: 38G2: 8.4%
12%6%
MéxicoTM1: 1,113G2: 2.3%
Unique Region-Wide Tissue Market Presence
13
Source: CMPC, RISI
1 TM: Total Tissue Market in th. Tons as of 2016
2 G: CAGR 2006-2016
More than 40 years of
expertise in the LatAm
consumer business.
.
Top 5 tissue and sanitary
products producer in every
major Latin American market.
Focused on growth in key
markets and underpenetrated
sanitary product markets.
Steady expanding capacity,
combination of organic &
inorganic growth.
Comprehensive Portfolio of Well-Known and Well-Regarded Brands
Away from Home Personal Care ProductsTissue Paper
Source: CMPC
14
Source: CMPC
15
Food &
Beverage
Consumer
Goods
Pharmaceutical Building
materials
Food &
agricultural
products
Chemicals &
minerals
Industrial Produce Salmon
Cost competitiveness from fiber
and vertical integration
Long-term relationships with
customers
Packaging: favorable competitive position
Industry Drivers
Global Paper Demand Evolution
Other Paper and Board
Tissue
Containerboard
Printing and Writing
Newsprint
Population Growth
Urbanization
Economic Growth
Rising disposable income
Increase in Product Quality
E-Commerce
Circular Economy
Intelligent Packaging
17
39 37 37 37 39 38 39 38 37 32 32 31 30 28 26 24 23 22
104 99 102 105 112 113 117 119 116 105 110 110 108 107 105 102 100 98
96 96 102 105 112 117 123 128 130
128 139 142 146 149 153 157 161 166
21 22 23 23
24 25 26 27 28
28 29 30 32 33 34 35 36 38
69 68 70
72 75 76
79 82 81
77
84 85 87 89 91 91 93 95
-
50
100
150
200
250
300
350
400
450
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
329 322333
343
363 369383
394 392
371
395 399 401 405 409 410 418414
Source: RISI
Dynamics of the Pulp Market
Source: Hawkins Wright 2017, CMPC
18
38%
9%18%
8%
2%
10%
16%
Tissue
UWF Packaging
CWF
Mechanical
Fluff
Specialty
Market Pulp by Final Use
Tissue Paper Demand Dynamics
Source: RISI, World Bank and CMPC as of 2017
19
Per capita annual consumption of tissue paper (in kilograms)(Countries in green are CMPC operation countries)
Tis
sue
Pa
pe
r A
pp
. Co
nsu
mp
tio
n (
k/c
ap
ita
)
GDP per capita in USD'000
0 10 20 30 40 50 60
5
10
15
20
25
Strategy
CMPC’s Strategy
21
Strengthen the core
Grow in all business divisions
Focus on developing our people
Innovate in bio-economy and digitalization
• Continue implementing
productivity programs in all
our mills to increase asset
productivity (OEEs)
• Create a forestry fund in Brazil
to prepare for future organic
growth
• Evaluate growth alternatives
in Packaging while capturing
synergies
• Explore organic & inorganic
alternative for main Softys
markets
•Develop the skills and talents
to form a high-performance
team with strong culture
•Develop new programs with a
focus on gender equality and
inclusion of people with
disabilities
• Strengthen CMPC’s position
as a key player in the bio-
economy
• Advance in digitalization and
Industry 4.0
• Leverage the innovation eco-
system to generate value
Sustainability
Prudent Financial Management
Pulp Strategy: Improving margins through operational excellence
Forest Base Expansion
Creation of a forestry fund in Brazil to
prepare for future organic growth
Operational Excellence Program
Plywood
+8% 1
Laja Mill
+7% 1
Pacifico Mill 2
Santa Fe Mill
L1:+10% 1
L2:+4% 1 Guaiba Mill 2
1 Increase in production efficiency (%) between 2016 and 2018
2 Operational excellence programs are still underway and haven’t had one full cycle yet or will be launched beg. 2019 22
Debottleneck & Modernization Initiatives
Evaluation of debottleneck and modernization
initiatives in our pulp mills to increase production
in our mills
SEPAC Acquisition
Softys agreed to purchase the Brazilian company Sepac. The
consummation of the transaction is subject to conditions precedent.
Once those conditions are meet, Softys would consolidate an
installed capacity of 280 th tons of tissue paper.
Softys Strategy: Leading Latin American Producer
Profitability StrategySoftys
Leading markets
Strengthen our
leading position
Opportunity markets
Focus on Brazil and
Mexico to gain go-to-
market capabilities and
market share
70% 41% 55% 80%
60 thtons
Zárate tissue machine
1Q20
USD 130Million
60 thtons
Cañete tissue mill
1Q17
USD 140Million
23
Revenue Management
Procurement
Operational Excellence Program
Fixed Cost Reduction
Brand Innovation Approach
Source: CMPC
135 th tonsTissue Paper
Capacity
BRL1,312Million
Transaction Price
175 M UnitsBaby Diapers
Capacity
Packaging Strategy: Expand business and gain efficiencies
24
Source: CMPC
Corrugated
Integrated all CMPC corrugated related businesses to capture synergies and improve operational
efficiencies
Increase productivity via a continuous improvement program (BEST)
Regain sales volumes and market share, optimizing prices
Increase productivity via a continuous improvement program (BEST)
Continue growing through the existing commercial platform
Increase our sack paper capacity - New conversion line in Peru (60 million sacks/year)
New market development as a result of the plastic bag ban in Chile - 3 new conversion lines in Chile
(115 million bags/year)
Boxboard
Paper Sacks
Corrugated
Profitability
Source: CMPC as of June 2019, figures in USD.
1 ROIC = (EBITDA – Depreciation – Stumpage) / (Accounts receivable + Inventory + Net Property, Mills and Equipment + Biological Assets (Stumpage Value) – Operating Liabilities) 25
EBITDA Margin
ROIC1
Free Cash Flow LTM
392 374
502
702
575
200
0
100
200
300
400
500
600
700
800
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
6,6%
8,5% 8,6%
9,8%9,0%
7,4%
0%
2%
4%
6%
8%
10%
12%
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
27%31% 31%
26%23% 23%
42%
49%53%
46%
39% 39%
11%6% 6%
9%10% 10% 10%
5%
12%
8%0%
10%
20%
30%
40%
50%
60%
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
CMPC Pulp Softys Packaging
Prudent financial management: conservative debt profile
Debt by currency Debt by interest rate Debt by type
$3,713 mm
Total debt
$3,192 mm
Net debt
Debt breakdown
USD
90%
3%
4% 3%
BRL
CLP
Other
98%
2%
Variable Rate
Fixed Rate 82%
3%
7%
8%BNDES
ECA
Banks
Bonds
26
$521 mm
Cash
Source: CMPC, as of June 2019, figues in USD.
Amortization Schedule (USD Million)
5.7 YearsAverage Term
4.8%
Average Rate62 189 139 138 40 73 37185
25 25
498497 526
1.056
196
31278 214
164
635537
599
1.094
196
2019 2020 2021 2022 2023 2024 2025/2031 2032/2041
Interests
Bonds
Banks
Prudent Financial Management: Stable credit metrics and prudent financial policies
27
Net debt to EBITDA
Financial debt to equity
Interest coverage ratio
Cash1 / (18M Net Financial Interest + amortization)
Financial Policy CovenantSource: CMPC, as of June 20191 Cash = cash & cash equivalents + undrawn committed lines of credit
2,5x
2,2x
1,8x1,6x 1,7x
2,0x
1,50x
2,00x
2,50x
3,00x
3,50x
4,00x
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
0,49x 0,48x 0,47x 0,47x 0,47x 0,45x
0,30x
0,40x
0,50x
0,60x
0,70x
0,80x
0,90x
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
5,87x
7,02x7,66x
8,50x 8,35x7,52x
0,30x
1,30x
2,30x
3,30x
4,30x
5,30x
6,30x
7,30x
8,30x
9,30x
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
1,15x0,98x
1,90x
2,17x
1,80x
1,29x
0,30x0,50x0,70x0,90x1,10x1,30x1,50x1,70x1,90x2,10x2,30x
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19
Appendix
73%
1,866,000Tons capacity
BHKP / Guaiba Mill
1,496,000Tons capacity
BHKP / Santa Fe Mill
520,000Tons capacity
BSKP / Pacifico Mill
278,000Tons capacity
BSKP / Laja Mill
87%52%
Pulp Division
$3,121Sales $1,396EBITDA $11,065Assets
1,148,000 hasForestry baseForestry assets*
Chile
472,000Planted has
Pine 64% Eucalyptus 32%
Brazil158,400
Planted has
Eucalyptus 100%
Argentina58,200
Planted has
Pine 100%
Sawn wood
960,000m3 capacity
Remanufactured wood190,000
m3 capacity
Plywood480,000
m3 capacity
Solid wood products* Pulp*
Chile
Brazil
*As of December 2018
29
LT
M J
un
e 2
01
9 (U
SD
Mill
ion
)
Feminine care 1,386 MM units
Diapers 3,970 MM units
16%8%33%
Softys Division
$2,016Sales $131EBITDA $2,399Assets
Main categories
Consumer tissue products
Tissue paper production capacity*
Personal Care productsProduction capacity*
Personal Careproducts
Away from home products
Chile
Brazil
Argentina
Mexico
Peru
Uruguay
Colombia
169,000
134,000
105,000
140,000
133,000
35,000
31,000
tons
30
LT
M J
un
e 2
01
9(U
SD
Mill
ion
)
*As of December 2018
Packaging Division
5%15% 10%
$916Sales $80EBITDA $1,618Assets
Production capacity
LT
M J
un
e 2
01
9(U
SD
Mill
ion
)
Boxboard
520,000tons
Chile
Other papers
66,000
Chile
Sackraft
tons
64,000
Brazil
Printing and writing
Corrugated paper
260,000tons
Chile
Corrugated boxes
211,000tons
Chile
Molded pulp trays 396 MM units
Chile
25,300 tons
31
Paper sacks 732 MM sacks
Chile
Peru
Mexico
Argentina
28%
31%
34%
7%
*As of December 2018
Pulp Demand 2017-2018
0
2,000
4,000
1 2 3 4 5 6 7 8 9 10 11 12
2017
2018
Source: PPPC GL 100 Dec 2018
In Q4 global demand declined 11%, this included a 14% decline in
hardwood and an 8% loss in softwood.
The demand in China which represents 33% of global demand had
significant declines. It fell by 31% in Hardwood and -23% in Softwood.
The decrease in volume is mainly explained by the deceleration of paper
demand around second half 2018, specially in China. This drove to an
excess of stocks of more than 60 days of supply in hardwood (16 days
over its normal level) and 42 in softwood (8 days over). Added to this,
some Brazilian competitors in hardwood, decided not to sell at lower
prices. Also, in Europe, paper demand has suffered.
-31%
Total
Eastern Europe
North America ChinaJapan
Western Europe
Latin America
Other Asia/Africa Oceanía
-2%-1%
-7%-4%
-13%
-6% -4%
9%
-14%
6%
-1%
3%
12%
-23%
7%
-2%
-8%
Source: PPPC GL 100 Dec 2018 SoftwoodHardwood
Th
ou
san
dT
on
s
Months
32
Drivers that explain the current situation
Source: Hawkins, World Bank, The Economist
Economist Industrial Commodity Index
World Bank non-energy Index
NBSK (net China)
BEKP (net China)
Price Commodity Index
RMB depreciation rose costs for pulp
buyers
Exchange Rate (RMB/USD)
China affected in terms of exports.
Trade War
6.4
6.3 6.3 6.3 6.4
6.5
6.7
6.8 6.8 6.9
6.9 6.9
5.8
6.0
6.2
6.4
6.6
6.8
7.0
RMB/USD
Source: X Rates Monthly Average
45%
33%
22%
Others
China
Nafta
81% 19%
Domestic
Imported
Source: PPPC
Fall of most commodities price was observed since
July 2018 continuing commodities trend, pulp
prices followed the fall with a lag.
33
Pulp Market Prices
34
927
827
572
496500
600
700
800
900
1000
1100
1200
1300
USD
Softwood Europe Hardwood Europe Softwood China Hardwood China
