Low stocks and China will boost Fibria''s sales in the second half

Sao Paulo-The low levels of inventories and the heated demand, especially from China, your main market, must ensure increases in sales for the manufacturer of eucalyptus pulp Company throughout the second half of 2017.
"We have a positive vision and optimistic for the second half of this year. Is a more challenging period, but the demand is positive ", said yesterday, during a teleconference with journalists, the Chief Finance and investor relations officer of the company, William Chan.
The positive moment of the paper market, both in Europe and in Asia, resulted in an increase in demand. All this, combined with a restricted supply of the commodity, due to some unscheduled stops and the delay in the entry of new capacity into the world, that reduced inventory levels, unleashing a string of price increases throughout the first half, said the company in the report accompanying the Administration balance.
In this way, the company''s production grew 3% in the second quarter compared to the same range of 2016, reaching 1.330 million tons, but sales advanced at a rate of 14%, higher to 1.534 million tons. In terms of days of stocks, Fibria closed the period with 52 days, equivalent to 890,000 tons, compared to 54 days a year before (930,000).
The net revenue of the company, for your time, amounted R $2.775 billion between April and June, an increase of 16%, compared to the previous year. The advance billing was pulled by the evolution of the volume sold and high of 11% in the average price of pulp in USD, partially offset by the 8% devaluation of the dollar against real. In terms of cost pulp production box, the value was virtually stable in R $660 per tonne.
The distribution of net sales of pulp, whereas the Klabin''s volumes, was concentrated in Asia (36%) and Europe (34%).
Expansion
The set of positive external demand will contribute to absorb the increase in production, from September. Company executives confirmed that the new pulp production plant in Três Lagoas (MS), will operate even in the third quarter of this year. At the end of June, about 96% of the physical execution of the works was completed. Investments in the project Horizon 2 will add R $7.5 billion. Of that amount, 69% have already been applied until last month, leaving some R $2.4 billion to be invested. The new plant will raise the production in 1.95 million tons per year.
Despite the positive results in the operational side, the company recorded a net loss of R $259 million in the second quarter, reversing a net profit of $745 million in the same interval R last year. The worsening in the last line of the balance sheet was a result, in the period of $789 million, compared with gains of R R $1.095 billion. In part, driven by the Exchange. "Any movement of Exchange variation impact on profit, but to no effect box," explained Chan.
Eldorado
The President of Fibria, Marcelo Castelli, said the company follows interested in competitor Eldorado, which is owned by J&F investments holding company, the brothers Joesley and Wesley Batista.
"There are a lot of synergies that can be created, but we will shell out a maximum value and that makes sense for its shareholders," said, without giving further details about how the Company would be willing to pay for the operation.
A negotiation, however, depends on withdrawal, by the Chilean Arauco, which already signed a preliminary agreement with the J&F. The operation may move something like R $11 billion, which includes the liabilities from Eldorado.
"The closing of the purchase will depend on the partners of Eldorado. We are monitoring and awaiting the outcome. "
Castelli also commented that the fact the two companies they land next, in Mato Grosso do Sul, could generate operational synergies "beyond initial expectations." "Commercial gain is the only one who still don''t know," he said.