Good morning, and thank you for joining CMPC's First Quarter 2026 earnings call. I'm Sebastián Moraga, CFO of CMPC.

Joining me today are Francisco Ruiz-Tagle, CEO of CMPC, Guilherme Viesi, Commercial Officer of Pulp, and Claudia Cavada, Head of IR. Before we begin, please refer to the standard note on the forward-looking statements in this presentation.

Before we dive into the numbers, I want to share how we are reading this quarter. The opening of 2026 has been about discipline, tightening the cost base, protecting the margin, and continuing to build the integrated value chain we announced last year.

There are three takeaways for the first quarter that I'd like to keep in mind. First is Guaíba mill maintenance.

The annual downtime of both lines was on schedule and drove a decline in production and an increase in cash cost for hardwood. Second, our cost discipline is starting to pay off, which is reflected in recovered margin levels at Biopackaging and EBITDA expansion in Softys.

Third, regarding Naturaleza project, our strategic agenda is on track to enable the board decision to take place during this year. Now to the headline numbers.

Sales of $1.8 billion were essentially flat year-on-year and down 4% quarter-on-quarter. Consolidated EBITDA was $255 million at a 14.1% margin, down 2% versus the fourth quarter and 8% versus first quarter of 2025.

Net income reached $25 million. We will comment EBITDA and net income later in the presentation.

Now let's go to the consolidated P&L drivers. On the left, sales of $1.8 billion broken down by business: Pulp at $731 million, Softys at $835 million, Biopackaging at $247 million.

Versus fourth quarter of 2025, Pulp was down $36 million mainly due to on lower volume sold, especially in China. Softys was $33 million lower on both tissue and personal care volumes, and Biopackaging is $7 million on a weaker corrugated demand in Chile.

Operating cost of $1.2 billion with a stable ratio over sales. Other operating expenses of $332 million sat at 18% of sales.

On EBITDA, in the quarter it decreased $7 million as the combination of $13 million decrease on the Pulp business given lower volume sales as well as lower volume in Softys reflected in an EBITDA decline of $11 million. This was partly offset by an increase of $16 million in Biopackaging EBITDA.

Versus the first quarter of 2025, Pulp decreased $37 million on volume, Biopackaging lost $8 million on volume reduction, and Softys added $16 million. As a result, consolidated EBITDA was $23 million below the prior-year quarter.

Net income came at $25 million, down 33% quarter-on-quarter. The main driver is below the EBITDA line: a reduction in the valuation of forest plantations driven by lower discount rates.

That was partially offset by a positive $17 million tax effects on Brazilian real appreciation revaluing deferred taxes. Year-on-year, the decline is mainly explained by higher SG&A in Softys.

CapEx came in at $185 million, up 24% year-on-year, with maintenance making up 56% of the spend and growth roughly 35%. We continue to invest behind the integrated value chain.

Now, I'd like to turn the presentation over to Claudia, who will provide more details on our results by business.

Thank you, Sebastián, and good morning everyone. On Pulp business, during the first quarter, sales reached $731 million, down 5% sequentially and 7% year-on-year.

This was almost entirely on hardwood, where third-party volumes fell 12%. This was explained by lower exports to China.

Softwood volume was stable. Pricing moved upwards.

Hardwood price averaged $561 per ton, up 6.1% sequentially, and softwood price averaged $674 per ton, this is 1.7%. EBITDA was $155 million with a 21.2% margin.

The headline cost driver this quarter was the planned Guaíba 1 and 2 lines maintenance. That took our hardwood cash cost to $262 per ton.

This is 15% above the 4Q '25. Softwood cash cost held at $400 per ton.

Next, let's discuss our Softys business. Softys delivered $835 million in sales, up 11% year-on-year on the Falcon integration in Brazil and a richer personal care mix.

Sales were down 4% sequentially on softer tissue and diaper volumes in Chile, Brazil, and Mexico. The market backdrop remains uneven: Chile, Peru, and Uruguay are constructive for us; Brazil and Mexico continue to face the context of overcapacity we flagged in mid-2025.

EBITDA of $97 million at an 11.7% margin, compared to 12.4% in the 4Q '25. The sequential dip is volume-driven, partially offset by savings from the MAXIO efficiency program.

On the year-over-year comparison, EBITDA was up 20% driven by Falcon, lower fiber cost effects, together with the effects of a better sales mix. Inside Personal Care, we're seeing positive trends in feminine care and wipes, and our diaper category is growing 4% year-on-year despite the seasonally weak first quarter.

Now let's discuss our Biopackaging business. Biopackaging had a recovery during this quarter at the EBITDA level.

Sales were $247 million, down 3% sequentially and 9% year-on-year, reflecting tougher market conditions and a strategic decision to prioritize margin over volume. In the quarterly comparison, EBITDA reached $23 million at a 9.4% margin, up from the 4Q '25.

Two effects matter here: the 4Q '25 carried inventory write-downs and warranty provisions in the corrugated business, those did not repeat this quarter, and the efficiency initiatives we rolled out through 2025 are now visible in the cost line. In the year-on-year comparison, EBITDA was down 25% cuz fixed costs don't fully flex with volume, but the sequential trajectory is what we expected to see, and the portfolio rationalization should continue to support margins through 2026.

Thank you very much, Claudia. We ended the first quarter of the year with roughly $5 billion of net debt.

Net debt-to-EBITDA stands at 4.1 times. We expect progressive normalization through 2026 supported by results evolution, working capital optimization, and operational efficiencies.

As we have mentioned on previous earnings calls, we are also evaluating asset monetization alternatives that could further strengthen the balance sheet. Investment grade rating status was reaffirmed across all three agencies, S&P, Fitch, and Moody's, the three with stable outlook.

Thank you, Sebastián. Recall that we welcome your questions and you can participate just by raising your hand or typing in the chat box.

We have a first question coming from Rafael Barcellos from Bradesco. Rafael, the floor is yours.

Good morning, thanks for taking my questions. Can you hear me?

Yes, very well. Yes.

Sorry, my first question is about your pulp cost. Can you please elaborate a bit more on your cash cost ex-maintenance downtime and how should we think about the cash cost in the coming quarters?

Also, can you remind us what you have in terms of maintenance downtime scheduled for the rest of the year? Could be helpful.

Then, my second question about pulp market Guilherme, if you can just tell us your understanding in the current cycle, if you can, just elaborate on where you see the main trends. Softwood markets have been very challenging, if I may, and just considering European exports, softwood markets, and then demand in China, just for the hardwood.

Thank you.

Hi Rafael, this is Francisco Ruiz-Tagle. How are you?

First question, in connection with cash cost of CMPC. I would say probably you will see an increase of the cash cost during this report compared with the first quarter.

It has a lot to be with the maintenance of Guaíba mill. We had the schedule maintenance for Guaíba 1 and Guaíba 2, the cash costs are pretty much influenced by those activity.

When you talk about ex-maintenance, I would say we continue with the situation with the cash costs in a very competitive tranche and although we have had some increase in wood prices during this year compared with the last year, but the main change in the cash costs has to be with the maintenance in January of Guaíba 1 and Guaíba 2. What is going to happen during the rest of the year according with the schedule maintenance, actually the main operation already stopped.

During the second semester, we should have Santa Fe mill with maintenance and basically Pacífico. This is more or less regarding the rest of the year.

I'd like to add something that could be interesting to mention now is that probably I'm not sure if you heard about that, but we had an unexpected stoppage in Guaíba this week. It was actually a problem, it was a non-scheduled maintenance.

Because we decided to stop the mill because we had a kind of a problem in the upper part of the boiler in Guaíba 2. We are in the process of maintenance now.

When you have problem in the boiler, as you have to cool the boiler and it takes some days. We will have that line stopped by probably eight to or close to 10 days, huh?

It's not part of the scheduled maintenance in the year. This is kind of a typical maintenance.

It was a problem in the upper part of the boiler and to solve that, it would take 10 days, huh? Just to mention that, it's important for me to transmit that.

Then

Guilherme can take the second question.

Sure. Rafael, thank you for the question.

We find ourselves in a market, I would consider the market balanced, with different characteristics in different markets. The demand overall in the market is actually good.

China comes with a good demand. I think the problem of paper prices in China remains, overcapacity of production remains.

Let's not forget that we come from price increases pretty much since the half of last year. Prices have been steadily going up little by little.

We came out of Shanghai Pulp Week with a price increase, which is something that doesn't happen every year. I would call the attention for the European market.

European market is slightly tighter than the rest of the world. There is a price announcement of $50 gross for May now.

Specifically about softwood, as you said, softwood is on a slightly different trajectory, is softer, oversupplied. The domestic supply of softwood in China remains and that obviously affects the rest of the world.

We had a price decrease last month. Softwood in China is now trading at around $650 net.

That puts further pressure on softwood producers, mainly on North America, Canada, and Scandinavia. It is of our view that the capacity will continue to be reduced, will continue to be under pressure, and there will be further closures, as we have seen throughout last year and this year, there will be further closures in the softwood market and eventually, prices should rebound.

Okay. As a follow-up question, given the more challenging operational scenario for the second Q, as you described it, and already running with higher level of leverage, how do you see your leverage evolution through the year?

How prepared do you think the company is to see or to start the disbursements of the Naturaleza project? If you can just elaborate just a bit more on your views on the leverage evolution and your latest thoughts on the Naturaleza project could be good.

Also, if you had any recent talks with the rating agencies, if you have any discussions about the leverage, what are the considerations they are making could be interesting for us to understand. Thank you.

Rafael, hi. This is Sebastián.

Regarding leverage, as we disclosed in our report, we believe that the 4.1 will have a downward trend during the year, basically driven by efficiencies and cost, which will have an impact on better results and also the working capital efforts we are performing. Additionally to that, we have been mentioning the potential asset monetization ventures that we are pursuing, which for obvious reasons I cannot give much color into that.

Once they obviously materialize, we could give more information to the market. Regarding rating agencies, we are very close to them.

We are having, I would say, well, first of all, it is important to mention that we were downgraded by Fitch, as expected, to BBB-, today CMPC is BBB- in Moody's, Fitch, and Standard & Poor's, three the three with stable outlook. Regarding how we expect to move forward with Naturaleza in terms of indebtedness and the strategy of financing it, yes, we are very close to the rating agencies, they are very well acquainted to our strategy in order to, again, keep the investment grade status at announcement, during the construction, and once we finish Naturaleza.

Now regarding Naturaleza, I would say, Francisco, if you want to take that question.

Just to take the last part of the question, Rafael, your question connected with this challenging operational quarter, just to say that the mills have been running at a good efficiencies, and so what I mentioned has to be with I would say kind of a problem that you can have in a mill and we are stopping for some days, but not seeing this situation as a big problem for the company. I would expect that it will continue running at a good pace and also with a very competitive costs, better costs compared with the first quarter, very much influenced as I said because of the scheduled maintenance in January.

Regarding Naturaleza, I couldn't see that decision could affect in the short term the level of debt of the company. The decision will not be taken within the next couple of months, it will take more time.

We are still on the process of permission. We are expecting for the licença prévia or previous license.

We should have that within the next couple of months. Then it will take probably some more weeks in getting the installation license.

We are not deciding this project until some more months. What Sebastián said according with our plans of financing and monetization of some assets, my impression is that it's a very well-coordinated with all of our decisions.

Very clear. Thank you.

Thank you, Rafael. Recall that you can make your questions in any moment just raising your hand or typing in the chat box.

We have a next question coming from Itaú, Marcelo Furlan. Marcelo, good morning.

Hi. Morning, everyone.

Can you hear me?

Yes, we can hear you.

Guys, thanks for taking my questions. My question is actually a follow-up from the previous one related to the company's expectation of the financial deleverage.

Could you please elaborate a little bit more, given the fact that maybe the top line for the next months, at least in the pulp, would be more challenging? What are the main efforts the company should have or we should expect in terms of EBITDA improvement and free cash flow and stronger free cash flow generation that could be made through the company's self-help initiatives that actually could improve that and then lead to this financial deleverage moving forward?

This is my first question. My second question is what are the expected financial leverage ratio you guys believe could be reached by year-end, assuming no CapEx for Naturaleza and assuming no forest divestments or things like that?

These are my main questions. Thank you, guys.

Marcelo, regarding your first question, I would probably mention again efficiencies in cost, revising CapEx, and working capital efficiencies. That is what is under the prices of pulp, and that's where we are, I would say, revising every of these three concepts very thoroughly in order to bring better costs and better financial management into the company.

Regarding ratings, more than giving a number per se, I would say that our aim is to be a solid BBB- investment grade company. We are following what three rating agencies state as complying with that status.

Again, we are having numerous conversations with them, not only with the trajectory of our leverage without Naturaleza, but also we're working with them in case we were to approve Naturaleza, what are all our financial tools and resources in order to again, with Naturaleza on the balance sheet, still be in compliance with being an investment grade company.

Thank you so much, guys.

Thank you, Marcelo. We have another question coming from Goldman Sachs, Marcio Farid.

Marcio, good morning.

Thanks, Claudia. Thanks, everybody.

Good morning. Francisco, just wanted to follow up on Naturaleza.

It seems like you've changed the language a little bit in terms of timing. Our expectation was for a decision potentially by end of second quarter.

Obviously, you mentioned a few months in order to get licenses done and so on and so forth. Just wondering if there has been any change in terms of how you approach the investment decision given obviously there's a war happening, there's a lot of market uncertainties as well.

Just trying to understand if the language has changed just because of licensing conditions or anything else. Maybe a follow-up on the pulp side to Guilherme.

Guilherme, you mentioned Europe doing a little bit better than China. Just wondering if obviously softwood has been under pressure in China.

The last couple of push for higher prices on the hardwood side have only partially been implemented. Just wondering what do you think is going to be the next step here?

Are we going to get is it a push for higher price makes sense? Obviously costs going up, but then paper price, as you mentioned, under pressure in China.

Just wonder what's the next steps in China? I think hardwood at $600 it's an okay price, right?

Let's see. Softwood at $650 seems to be weak, is there any room for that kind of spread to normalize as well?

Thank you very much.

Marcio, for your question, and I will take the first part. In connection with the final decision about Naturaleza, yeah, you're right.

We were expecting to have everything ready for the mid-year. Actually, we talked about the end of the second quarter or during the third quarter.

Basically what has been happening is that the previous license supposed to be ready by the beginning of this year, and we were asked about some extra question connected with social aspects of and impacts of this project in Rio Grande do Sul. It took actually more time in responding from our side, it is taking a couple, two or three more months in getting the previous licensing, which is an important moment for us.

This is the main reason why we are moving from mid-year to some extra more months. Just to say that the company has fully committed with the project, we see this project as a very important for CMPC.

Of course, we also take into account for our decision, and our board has transmitted that it will be a very responsible decision, very committed with the project, with the idea for the future of CMPC, but it said it will be a responsible decision considering what is happening around the world. It is true that uncertainty is a very important today.

I don't have to speak about that because you know more than us about that. Everything will be considered for that.

The main reason for moving a bit ahead the revision, hopefully final revision of this project is because it took some more time the environmental permits process.

Can I just follow up before we move to Guilherme quickly? Just there was a news, I think a couple of months ago, saying that I think a indigenous community in the area was complaining about the project.

Is that something that should be worried or is it more about getting social recognition and social license as well for the project?

It was a prosecutor in Rio Grande do Sul, one person that asked about FEPAM and FUNAI, those institution about to consider recommendation of some indigenous communities. My comment on that is we have been responding everything that the law is requiring for this kind of projects.

We are 100% focused on responding what the law is asking us. My impression is that we are doing a right process.

Regarding the comment of the recommendation of this prosecutor in Rio Grande do Sul, it was a kind of a federal conselho of Ministério Público some days ago, 10 days ago, they said this is not correct, and they are recommending FUNAI and FEPAM, the environmental authority, to continue with the normal process of approving this kind of project. Of course it's always when you are required something like that, it's something that is challenging us.

We feel very comfortable with the all of our responses and the studies that we have done connected with indigenous situation. It's a matter of concern?

Always when you don't have still the license, could be, but we feel honestly very 100% comfortable about having a kind of a very positive process.

Thank you very much. Márcio,

thanks for the question. Regarding hardwood, yes, you're right that $600 is not a bad price, but also cost, let's remind ourselves that cost doesn't really determine the price of the commodity in the world.

What determines the price is supply and demand. This year we do not have any new capacity of pulp coming into the market.

From a purely supply-demand perspective, we should see prices going up because market is growing organically every year. Again, different markets with different dynamics.

I do see Europe with more space for price increase this year. Europe already has a gap to China of something around $50, give or take, with another price increase announced for this month, we could see Europe opening a gap to China of, I don't know, $75, $80, something like that.

We see momentum, we see inventories in Europe on a low level, we see shipments being diverted from China to Europe because it's paying a higher margin, and China could find themselves with a tight inventory in the next few months. Going to softwood, you're right, the gap from hardwood to softwood I think is unsustainable now.

The price of softwood is low. I think statistics will say that something around 80% to 90% of the world's softwood production is below break-even as we speak with current price levels, we should see further closures on the softwood, and again then prices of softwood should rebound and to a more sustainable gap between softwood and hardwood.

Overall in summary, I see a 2026 with opportunities of further price increases if there's no surprise on the economical side globally. We should see prices continue in the same trend, modestly, not with huge jumps in price increase, but modestly the trend should be upwards on the hardwood, and eventually when we see closures on softwood, the same.

Great. Thanks, Guilherme.

Thanks, Francisco. Can I just follow up on a comment you made earlier?

You mentioned an issue at Guaíba with the recovery boiler, and you talked about 10 days. Is that extra, in addition to the first half maintenance downtime, and is it going to be impacting Guaíba 1 and Guaíba 2, or is it just one of the lines?

Thank you.

It's extra and it's just impacting Guaíba 2.

Great, thank you very much.

Thanks, Marcio. We have another question coming from Scotiabank, Alfonso Salazar.

Alfonso, good morning.

Yes, good morning. I have a question on Naturaleza.

Look, I think that to build a project this size, it's very important to take into consideration the outlook for demand in 5, 10, 15 years. When we look what is happening in China, well, here are the facts: population is in a downtrend, consumption is weak and it's hard to see why it's going to recover, more people are going to be living in a low pension going forward, and the ratio between the working people and the people that is supporting retired people is going to deteriorate very sharply.

Those are the trends that people are considering in their base case for China. Wondering if to what extent the Naturaleza project is supported by China or are you seeing growth and opportunities in other markets?

Where exactly, right? Maybe it's Europe, maybe it's more for the Americas.

Just wanted to reconcile this situation because, to me, we have seen the demand of commodities starting to be under pressure in China, and I don't know if seeing the big increase in demand in China in terms of pulp and paper in the past is a good predictor of what's going to happen in the future. I just want to hear your thoughts.

This is Raimundo, I'll take your question Alfonso, which is very good. What we see basically is that China paper consumption continue to increase.

The main trend behind has to do with the middle class. China has approximately 400 million people in middle class today, and their plan is that another 400 million will become middle class in the next 15 years.

That's a very relevant trend for basic products consumption. Paper, at the end of the day, is a very basic product.

It's used in everyday's life. It's not an expensive product.

Middle class is a key theme, and China is in a process, has been and it continue to be in a process where people is becoming middle class and therefore paper consumption increases. At the same time, the importation of the growth on pulp imports will be slower than before, mainly because China have been producing their own pulp, no?

That therefore has limited the growth on imports. In our plans for Naturaleza, we are estimating that the imports of pulp in China will grow at a slower rate, roughly about 40% to 50% slower than before.

Will continue to grow, but at a slower pace, mainly for what I just said regarding their own production, not because the demand will be much slower. We are forecasting growth in other markets.

I think some markets that are relevant to mention are India, for example, where their growth percentage-wise is quite impressive. In terms of absolute volume, it's not huge, but it's relevant, I would say.

Today, India imports close to 1.5, 1.7 million tons and that number can easily double in the next 10 years. We are a relevant player on that market.

We also see steady growth in North America. Then there's also a situation where some mills will probably close, no?

There's the age of the mills in the Northern Hemisphere that will also produce a space for demand. Then you have fiber substitution, no?

Which is also relevant. All in all, what we are forecasting is a market that will continue to grow for short fiber around 900,000 tons per year, which is a little bit slower than before.

As I said, with China being relevant, but a slower percentage of the whole growth.

Can we say that China remains part of the strategy, then you see opportunities in other markets like India, for example, and then you also see high-cost mills leaving the market eventually as they age? Is a combination of everything.

Absolutely. I think we are talking about paper is a relatively mature market, the demand will not explode, no?

It's a mature market. Companies need to have a very healthy and low cost base, no?

We do see growth in the paper market at a steady growth, as I mentioned.

Clear. Thank you.

Thanks, Alfonso. I see that we don't have more hands raised here, and in the chat box, I see that the questions were basically covered by the call.

I think that we can finish this earnings call. Thank you very much for attending today and for your participation, and we wish you have a good day.