Institutional presentation

July 2011

Businesses and Markets

Pulp and paper segment

2

Segment info 222 Companies with activity in 539 cities, located in 18 states; 2.2 million hectares of industrial oriented planted forests; 2.9 million hectares of native preserved forests; 2.0 million hectares of certified forests; 2009 Exports: US$ 5.0 billion 2009 Trade balance: US$ 3.7 billion (14,4% of Brazils total trade balance); Taxes paid : R$ 2.2 billion; Investments: US$ 12 billion in the last 10 years; Employment: 115 thousand direct employees (68 thousand in industry, 47 thousand in forests) and 575 thousand indirect employees.

Largest producers

Pulp
Country 1 2 3 4 5 6 7 8 9 10 11 12 USA China Canada Brazil * Sweden Finland Japan Russia Indonesia Chile India Germany Other Total thousand tonnes 48,329 20,813 17,079 13,315 11,463 9,003 8,506 7,235 5,971 5,000 3,803 2,545 24,898 177,960 1 2 3 4 5 6 7 8 9 10 11 12 Country

Paper
thousand tonnes 86,391 71,613 26,279 20,902 12,857 10,933 10,602 10,481 9,428 9,363 8,693 8,449 84,696 370,687 China USA Japan Germany Canada Sweden Finland South Korea Brazil * Indonesia India Italy Other Total

Source: RISI 2009 * Bracelpa

Brazils forestry productivity

Reasons to the high productivity levels Weather and soil R&D Organized private sector Skilled labor

Technological updates Genetics Biotechnology High quality raw material Social and environmental planning Forest management

Wood for pulp

Average productivity (m / ha*ano) 1980 Eucaliptus Pine 24 19 2009 44 38 Var 83% 100%

Businesses and Markets

Klabin
6

Klabin

112 years of tradition Largest paper producer, exporter and recycler of the country Leader in coated boards and packaging paper, corrugated boxes and industrial bags Production capacity of 1.9 million tonnes per year Exports to more than 70 countries 14.6 thousand direct and indirect employees Gross revenue of R$ 4.4 billion per year

Business units

Wood logs 7% *

Kraftliner 13% *

Coated boards 34% * Corrugated boxes 31% *

Total Net Revenue: R$ 3.7 billion in 2010

Industrial Bags 13% *

Notes: In 2010, 2% of sales volume was composed of other products. * Percentage of 2010 net revenue.

A company 100% integrated

Domestic market

wood logs

planted forests: 212,000 ha

pulp coated boards

Domestic & export markets

industrial bags

pine and eucalyptus

planted forests

short fiber and long fiber pulp kraftliner

Domestic market
o.c.c. recycled paper corrugated boxes

paper capacity: 1.9 mi tonnes

Notes: All figures refer to installed production capacity. OCC Old Corrugated Container

Forestry Base - March 31st, 2011

95 Km *

51 Km *

So Paulo Paran

(thousand ha) Eucalyptus 73 Km *

Santa Catarina

77 135

Pine

Planted area 212 Native Others Total lands 193 59 459

Note: All forests are certified by FSC (Forest Stewardship Council). * Average distance.

10

Forest Stewardship Council

Independent, non-governmental, not-for-profit organization established to promote the responsible management of the worlds forests. Supports management of forests environmentally appropriate, socially beneficial and, economically viable.

Klabin 1st company in America in the pulp and paper segment to conquer FSC certification for the forests in Parana State in 1998 1st company in the world to have phytocosmetic products certified by FSC in 1999 The only Latin American company to have certification for the processes in all its products.

11

Forestry management: mosaic

12

Native forests

2.6 thousand Km of ecological corridors in Monte Alegre (PR)

Protect soil and biodiversity Regulate water flow In Paran 123,000 hectares For every 100 hectares planted, Klabin preserve around 80 hectares of native forests

13

Klabin in Paran

Presence in the region since 1934; Forests in 34 municipalities; Mill located in Telemaco Borba; Largest integrated pulp and paper mill in Latin America; 4,500 employees.

14

Monte Alegre Mill

1946

2011
15

Monte Alegre Mill World largest paper and boards mills

0 Nine Dragons Paper - Xinshagan - Dong City (China) Gold East Paper - Daganga, Zhenjiang City (China) Daio Paper Corporation - Iyomishima (Japan) Nordland Papier - Drpen (Germany) Weyerhaeuser - Valliant (USA) UPM-Kymmene - Rauma (Finland) International Paper - Mansfield (USA) PT Indah Kiat Pulp & Paper - Serang (Indonesia) PT Pabrik Kertas Tjiwi Kimia - Mojokerto (Indonesia) Klabin Papis - Monte Alegre (Brazil) Georgia-Pacific - Cedar Springs (USA) Longview Fibre Co. - Longview (USA) Shandong Sun Paper - Yan Zhou City (China) Shandong Huatai Paper Industry - Dongyin City (China) Stora Enso Kvarnsveden - Borlnge (Sweden) Oji Paper - Tomakomai (Japan) PanAsia Paper Korea - Deukjingu Jeonju (Korea) Stora Enso - Kemi (Finland) Georgia-Pacific - Monticello (USA) Stora Enso - Nuottasaari, Oulu (Finland) 200 400 600 800 1000 1200 1400 1600 1800 2000

Monte Alegre 10th Largest paper mill in the world 1.1 million tonnes per year

Source: Jaakko Poyry Consulting

16

Monte Alegre Unit Industrial environment: sustainable development

Energy matrix based on our own forests. Use of biomass - 98% of the steam comes from: Black liquor Bark and wood (biomass)

17

Businesses and Markets

Financials
18

Financial figures
Net revenue
(R$ million)
24%

EBITDA
(R$ million)
22%

Sales volume
28% 24%

(thousand tonnes)

11%

29%
78% 39% 72% 76% 36% 32%

68% 61% 64%

Domestic market
19

Export market

Net debt

The Company is committed to its deleveraging, in order to be prepared to a new growth cycle.

5,500 4,500 3,500 2,500 1,500 500 (500)

5.3 4.4 3.7

3,786

3.6

3.1

2.8 2.2 2.2

2,128

3,192

2.1
2,002

Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11

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 -0.5 -1.0 -1.5 -2.0

2,886

2,676

2,528

2,462

Net Debt (R$ million)

Net Debt / EBITDA (LTM)

20

2,106

Businesses and Markets

New growth cycle

21

Competitive advantage

Hardwood Rotation
(years)

Softwood Rotation
(years)

Source: Pyry and Klabin

22

23

Source: Hawkins Wright, April 2011 -1Q11 Estimates

US$ / tonne

300

400

500

600

700

800

100

200

Brazil Chile Indonesia Russia

Bleached hardwood

Iberia & Norway Finland China USA France / Belgium Sweden Taiwan South Korea

Pulp cash cost

Chile Russia USA

Bleached softwood

Finland Fra / Aus / Ger Sweden Japan BC Interior BC Coast Eastern Canada

Market

New short fiber pulp mills are being installed in the Southern Cone, due to the advantage of the eucalyptus yield: Ongoing projects: Eldorado - MS; Suzano MA; Montes del Plata Uruguay Others in study: Suzano PI; Fibria MS; CMPC - RS

24

Pulp market

Lack of new long fiber capacities in Brazil and in the world; High costs in northern hemispheres; Capacity closures or conversion; Good productivity of the Brazilian pine competitiveness also in this segment.

25

Power generation

A pulp mill "state of the art" has large surplus of energy generation based on: Black liquor Biomass - bark and forest residues;

This surplus is between 100 and 150 MWh/h;

26

Paranagu port

Klabin area 40,000 m

27

Investiment The pulp line will have the capacity of production of 1.5 million tonnes per year, with forecasted investments of : R$ 4.6 billion at the mill and logistics structure; R$ 2.0 billion in forests. Funding BNDES: R$ 2.8 billion; Own capital: R$ 1.9 billion; Partner: R$ 1.8 billion.

28

29
a P B K a l N r n t D b e n i E S r f S n i A / w a i l n p l w c i n i l r p l o g v i r e d o v i a c e p d a l i a t n

Project funding structure

s t

Expected results

R$ Million
Sales volume (thousand tonnes)

Klabin today 1,800 4,000 1,100

Pulp 1,500 2,100 900

Klabin - future 3,300 6,100 2,000

Net revenue EBITDA

Forecast

Internal rate of return estimated at 17% and EBITDA margin of 45%

30

31