Q2 2026 Empresas CMPC SA Earnings Call

August 7, 2026

Sebastian Moraga: Good morning, and thank you for joining CMPC's Q2 2026 earnings call. I'm Sebastian Moraga, CFO of CMPC. Joining me today are Guilherme Viesi, Chief Commercial Officer of Pulp, and Diego Merino, Finance Director Brazil and Head of IR. Before we begin, please refer to the standard note on the forward-looking statements in this presentation. Before we go into the presentation, I want to share the key highlights of this quarter. The Q2 reflected continued recovery both in pulp and Softys, and at the same time, we are facing some challenges that we believe are important to discuss. Being said that, there are the four takeaways for this quarter I'd like you to keep in mind. First, pulp price recovery took hold. A 7% sequential increase in hardwood price, together with a 3% reduction in its cash cost, lifted pulp EBITDA 16% quarter-on-quarter to $180 million.

Sebastián Moraga: Good morning, and thank you for joining CMPC's Q2 2026 earnings call. I'm Sebastián Moraga, CFO of CMPC. Joining me today are Guilherme Viesi, Chief Commercial Officer of Pulp, and Diego Merino, Finance Director Brazil and Head of IR. Before we begin, please refer to the standard note on the forward-looking statements in this presentation. Before we go into the presentation, I want to share the key highlights of this quarter. The Q2 reflected continued recovery both in pulp and Softys, and at the same time, we are facing some challenges that we believe are important to discuss. Being said that, there are the four takeaways for this quarter I'd like you to keep in mind. First, pulp price recovery took hold. A 7% sequential increase in hardwood price, together with a 3% reduction in its cash cost, lifted pulp EBITDA 16% quarter-on-quarter to $180 million.

Speaker #2: Good morning, and thank you for joining CMPC's Q2 2026 earnings call. I'm Sebastian Moraga, CFO of CMPC. Joining me today are Guillermo Viesi, Chief Commercial Officer of PALT, and Diego Merino, Finance Director Brazil and Head of IR.

Speaker #2: Before we begin, please refer to the standard note on the forward-looking statements in this presentation. Before we go into the presentation, I want to share the key highlights of this quarter.

Speaker #2: The Q2 reflected continued recovery both in PALT and Softis, and at the same time we are facing some challenges that we believe are important to discuss: being said that, they are the four takeaways for this quarter I'd like you to keep in mind.

Speaker #2: First, PALT price recovery took hold. A 7% sequential increase in hardwood price, together with a 3% reduction in its cash cost, lifted PALT EBITDA 16% Q2 on Q2 to $180 million.

Sebastian Moraga: This was achieved despite a more demanding environment of higher energy and logistics costs tied to Brent. Second, Softys confirmed its improvement in results. EBITDA reached $101 million, up 4% versus the previous quarter, showing that our efficiency and cost optimization initiatives continue to capture benefits and help offset the Brent-related cost headwind. Third, Bio packaging had a more challenging quarter. Sales were up 2%, but EBITDA fell to $15 million on continued boxboard oversupply formation, plus seasonality and one-off costs in corrugated. As we flagged last quarter, we expect the operational and efficiency initiatives underway to translate into a better scenario toward year-end. On leverage, our net debt to EBITDA reached 4.17x, and we are very aware that this remains outside our target range. We expect it to decline progressively over the coming quarters as results and cash generation improve.

Sebastián Moraga: This was achieved despite a more demanding environment of higher energy and logistics costs tied to Brent. Second, Softys confirmed its improvement in results. EBITDA reached $101 million, up 4% versus the previous quarter, showing that our efficiency and cost optimization initiatives continue to capture benefits and help offset the Brent-related cost headwind. Third, Bio packaging had a more challenging quarter. Sales were up 2%, but EBITDA fell to $15 million on continued boxboard oversupply formation, plus seasonality and one-off costs in corrugated. As we flagged last quarter, we expect the operational and efficiency initiatives underway to translate into a better scenario toward year-end. On leverage, our net debt to EBITDA reached 4.17x, and we are very aware that this remains outside our target range. We expect it to decline progressively over the coming quarters as results and cash generation improve.

Speaker #2: This was achieved despite a more demanding environment of higher energy and logistics costs tied to brands. Second, Softis confirmed its improvement in results. EBITDA reached $101 million up 4% versus the previous quarter, showing that our efficiency and cost optimization initiatives continue to capture benefits and help offset the brand-related cost headwind.

Speaker #2: Third, bio packaging had a more challenging quarter, sales were up 2% but EBITDA fell to $15 million, on continued boxport oversupply formation. Plus, seasonality and one-off costs incorrugated.

Speaker #2: As we flagged last quarter, we expect the operational and efficiency initiatives underway to translate into a better scenario toward year-end. On leverage, our net $4.17 times and we are very aware that this remains outside our target range.

Speaker #2: We expect it to decline progressively over the coming quarters as results and cash generation improve. And we continue advancing our asset monetization program to further strengthen the balance sheet.

Sebastian Moraga: We continue advancing our asset monetization program to further strengthen the balance sheet. Preserving a robust capital structure consistent with international investment-grade rating remains fundamental for CMPC. On Natureza project, we continue to advance on the enabling conditions. In June, we obtained the licencia previa for the Rio Grande terminal, an important step forward. Now to the headline numbers. Sales of $1.9 billion were up 5% compared to the Q1 of this year, and essentially flat year-on-year. Consolidated EBITDA was $270 million at a 14.1% margin, up 6% versus the Q1, but down 19% versus the Q2 of last year. Net income reached $9 million. We will comment details on EBITDA and net income later in the presentation. Going to the consolidated P&L drivers. On the left, sales of $1.9 billion broken down by business.

Sebastián Moraga: We continue advancing our asset monetization program to further strengthen the balance sheet. Preserving a robust capital structure consistent with international investment-grade rating remains fundamental for CMPC. On Natureza project, we continue to advance on the enabling conditions. In June, we obtained the licencia previa for the Rio Grande terminal, an important step forward. Now to the headline numbers. Sales of $1.9 billion were up 5% compared to the Q1 of this year, and essentially flat year-on-year. Consolidated EBITDA was $270 million at a 14.1% margin, up 6% versus the Q1, but down 19% versus the Q2 of last year. Net income reached $9 million. We will comment details on EBITDA and net income later in the presentation. Going to the consolidated P&L drivers. On the left, sales of $1.9 billion broken down by business.

Speaker #2: Preserving a robust capital structure consistent with an international investment-grade rating remains fundamental for CMPC. On the nature project, we continue to advance on the enabling conditions.

Speaker #2: In June, we obtained the licencia previa for the Rio Grande terminal, an important step forward. Now, to the headline numbers. Sales of $1.9 billion were up 15% compared to the first quarter of this year, and essentially flat year-on-year.

Speaker #2: Consolidated EBITDA was $270 million, at a 14.1% margin, up 6% versus the first quarter, but down 19% versus the second quarter of last year.

Speaker #2: Net income reached $9 million. We will comment details on EBITDA and net income later in the presentation. Going to the consolidated P&L drivers. On the left, sales of $1.9 billion broken down by business.

Sebastian Moraga: Pulp at $768 million, Softys at $893 million, Bio packaging at $251 million. Versus Q1, Pulp was up $37 million, almost entirely on the 7% increase in the average hardwood selling price. Softys added $58 million on the sales recovery in Brazil and Mexico across both tissue and personal care, and Bio packaging was up $4 million on higher folding boxboard volumes. Versus the same quarter of last year, sales were essentially flat. Softys grew $76 million on higher volume in both personal care and tissue, but that was largely offset by the absence of last year's non-recurring Pensa sale, which contributed $71 million to Q2 of last year's sales. Operating cost of $1.2 billion held at a stable ratio at 68% of sales. Other operating expenses of $349 million sat at 18% of sales. EBITDA, in the quarter, it increased $15 million quarter on quarter.

Sebastián Moraga: Pulp at $768 million, Softys at $893 million, Bio packaging at $251 million. Versus Q1, Pulp was up $37 million, almost entirely on the 7% increase in the average hardwood selling price. Softys added $58 million on the sales recovery in Brazil and Mexico across both tissue and personal care, and Bio packaging was up $4 million on higher folding boxboard volumes. Versus the same quarter of last year, sales were essentially flat. Softys grew $76 million on higher volume in both personal care and tissue, but that was largely offset by the absence of last year's non-recurring Pensa sale, which contributed $71 million to Q2 of last year's sales. Operating cost of $1.2 billion held at a stable ratio at 68% of sales. Other operating expenses of $349 million sat at 18% of sales. EBITDA, in the quarter, it increased $15 million quarter on quarter.

Speaker #2: PALT at $768 million, Softis at $893. Bio packaging at $251 million. Versus the first quarter, PALT was up 37 million, almost entirely on the 7% increase in the average hardwood selling price.

Speaker #2: Softis added $58 million on the sales recovery in Brazil and Mexico, across both tissue and personal care, and bio packaging was up $4 million on higher folding boxport volumes.

Speaker #2: Versus the same quarter of last year, sales were essentially flat. Softis grew $76 million on higher volume in both personal care and tissue, but that was largely offset by the absence of last year's non-recurring Tensa sale, which contributed $71 million to the Q2 of last year's sales.

Speaker #2: Operating cost of $1.2 billion held a stable ratio at 68% of sales. Other operating expenses of $349 million sat at 18% of sales. On EBITDA, in the quarter it increased $15 million Q2 on Q2.

Sebastian Moraga: This was mainly explained by Pulp on higher hardwood pricing and lower fixed costs tied to forest protection. The latter was partially offset by the Brent-driven increase in logistic and selling costs. Softys added $4 million, and Bio packaging subtracted $8 million on lower folding boxboard EBITDA and corrugated seasonality. Versus the same quarter of last year, consolidated EBITDA was $62 million lower. The largest single driver in the comparison base, which included the Pensa sale, a $46 million EBITDA impact in Q2 of last year that did not repeat. Pulp EBITDA was also down $25 million on higher Brent-related costs, which increased forestry harvesting, transportation, energy, and raw material costs. This was partially offset by a $19 million improvement in Softys. Net income came at $9 million, down 65% quarter on quarter and 89% year on year.

Sebastián Moraga: This was mainly explained by Pulp on higher hardwood pricing and lower fixed costs tied to forest protection. The latter was partially offset by the Brent-driven increase in logistic and selling costs. Softys added $4 million, and Bio packaging subtracted $8 million on lower folding boxboard EBITDA and corrugated seasonality. Versus the same quarter of last year, consolidated EBITDA was $62 million lower. The largest single driver in the comparison base, which included the Pensa sale, a $46 million EBITDA impact in Q2 of last year that did not repeat. Pulp EBITDA was also down $25 million on higher Brent-related costs, which increased forestry harvesting, transportation, energy, and raw material costs. This was partially offset by a $19 million improvement in Softys. Net income came at $9 million, down 65% quarter on quarter and 89% year on year.

Speaker #2: This was mainly explained by PALT on higher hardwood pricing and lower fixed costs tied to forest protection. The latter was partially in logistics and selling costs.

Speaker #2: Softis added $4 million and bio packaging subtracted $8 million on lower folding boxport EBITDA and corrugated seasonality. Versus the same quarter of last year, consolidated EBITDA was $62 million lower.

Speaker #2: The largest single driver in the comparison base—which included the Tensa sale—a 46 million EBITDA impact in the Q2 of last year that did not repeat.

Speaker #2: PALT EBITDA was also down 25 million on higher brand-related costs, which increased forestry harvesting transportation energy and raw material costs. This was partially offset by a $19 million improvement in Softis.

Speaker #2: Net income came at $9 million, down 65% Q2 on Q2, and $89% year-on-year. Compared to last quarter, despite the $15 million EBITDA improvement, net income was pressured by foreign exchange losses in reais and Mexican denominated liabilities as both currencies appreciated.

Sebastian Moraga: Compared to last quarter, despite the $15 million EBITDA improvement, net income was pressured by foreign exchange losses in BRL and MXN-denominated liabilities, as both currencies appreciated. A lower price level restatement benefit, given a smaller hyperinflation adjustment in Argentina. Year on year, the decline mainly reflects the lower EBITDA and the FX losses on the Brazilian and MXN-denominated liabilities, partially offset by a $25 million income tax benefit this quarter versus a $10 million expense on the same quarter of 2025. CapEx came in at $170 million, down $15 million sequentially and down $157 million year on year. The year-on-year decline reflects the Fadelco acquisition that was part of Q2 of 2025 space. We had no inorganic growth spent this quarter, consistent with the capital discipline we're applying given our current leverage.

Sebastián Moraga: Compared to last quarter, despite the $15 million EBITDA improvement, net income was pressured by foreign exchange losses in BRL and MXN-denominated liabilities, as both currencies appreciated. A lower price level restatement benefit, given a smaller hyperinflation adjustment in Argentina. Year on year, the decline mainly reflects the lower EBITDA and the FX losses on the Brazilian and MXN-denominated liabilities, partially offset by a $25 million income tax benefit this quarter versus a $10 million expense on the same quarter of 2025. CapEx came in at $170 million, down $15 million sequentially and down $157 million year on year. The year-on-year decline reflects the Fadelco acquisition that was part of Q2 of 2025 space. We had no inorganic growth spent this quarter, consistent with the capital discipline we're applying given our current leverage.

Speaker #2: A lower price level restatement benefit given a smaller hyperinflation adjustment in Argentina year-on-year, the decline mainly reflects the lower EBITDA and the FX losses on the Brazilian and Mexican denominated liabilities, partially offset by a 25 million income tax benefit this quarter versus a $10 million expense on the same quarter of 2025.

Speaker #2: Capex came in at $170 million, down 15 million sequentially and down $157 million year-on-year. The year-on-year decline reflects the FALCOM acquisition that was part of two Q2 of 2025 space.

Speaker #2: We had no inorganic growth spend this quarter, consistent with the capital discipline we are applying given our current leverage. Now, I'd like to turn the presentation over to Diego, who will provide more details on our results by business.

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

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

Diego Merino: Thank you, Sebastian, and good morning, everyone. On Pulp Business, during Q2, sales reached $768 million, up 5% versus the previous quarter and roughly flat year on year. Hardwood prices averaged $600 per ton, up 7% quarter on quarter and 9% year on year, while softwood averaged $665 per ton, down 1% sequentially and 9% year on year, narrowing the price gap between the two fibers to $65 per ton from $113 last quarter and $117 a year ago. Production totaled 1,083,000 tons, up 10% quarter over quarter as hardwood output recovered 13%, following the maintenance shutdowns of both Guaíba lines in Q1 of this year. Softwood production is 3% on the scheduled general shutdown at Laja. EBITDA reached $180 million with a margin of 23.4%, increasing 16% quarter over quarter, while declining 12% year over year.

Diego Merino: Thank you, Sebastián, and good morning, everyone. On Pulp Business, during Q2, sales reached $768 million, up 5% versus the previous quarter and roughly flat year on year. Hardwood prices averaged $600 per ton, up 7% quarter on quarter and 9% year on year, while softwood averaged $665 per ton, down 1% sequentially and 9% year on year, narrowing the price gap between the two fibers to $65 per ton from $113 last quarter and $117 a year ago. Production totaled 1,083,000 tons, up 10% quarter over quarter as hardwood output recovered 13%, following the maintenance shutdowns of both Guaíba lines in Q1 of this year. Softwood production is 3% on the scheduled general shutdown at Laja. EBITDA reached $180 million with a margin of 23.4%, increasing 16% quarter over quarter, while declining 12% year over year.

Speaker #3: Thank you, Sebastian. And good morning, everyone. On PALT Business, during Q2, sales reached $768 million, up 5% versus the previous quarter and roughly flat year-on-year.

Speaker #3: Hardwood prices averaged $600 per ton, up 7% Q2 on Q2, and 9% year-on-year, while softwood averaged $665 per ton, down 1% sequentially and 9% year-on-year, narrowing the price gap between the two fibers to $65 per ton, from $113 last quarter and $117 a year ago.

Speaker #3: Production totaled 1,083,000 tons, up 10% Q2 over Q2, as hardwood output recovered 13% following the maintenance shutdowns of both Guaíba lines in Q1 of this year.

Speaker #3: Softwood production is 3% on the scheduled general shutdown at Laja. EBITDA reached $180 million. With a margin of 23.4%, increasing 16% Q2 over Q2, while declining 12% year over year.

Diego Merino: Compared to Q1 of this year, the improvement was primarily driven by a 7% increase in hardwood pulp prices and a 3% reduction in cash costs. These positive effects more than offset a more challenging cost environment as higher energy and logistic expenses linked to increased Brent prices weighed on results. On a year-over-year basis, EBITDA was lower, mainly due to higher Brent prices, which drove up both selling and logistic costs. This also translated into higher forestry harvesting and transportation expenses, as well as increased industrial costs related to energy and other key raw materials. Hardwood cash costs came in at $254 per ton, down 3% versus the previous quarter, mainly the comparison against Q1 of this year's Guaíba shutdown. The wood cost rose on higher Brent prices, higher DMT in Chile, and the Brazilian reais appreciation.

Speaker #3: Compared to Q1 of this year, the improvement was primarily driven by a 7% increase in hardwood Pulp Average List Prices and a 3% reduction in cash costs.

Speaker #3: This positive effect more than offset a more challenging cost environment, as higher energy and logistic expenses linked to increased brand prices weighed on results.

Speaker #3: On a year-over-year basis, EBITDA was lower mainly due to higher brand prices, which drove up both selling and logistic costs. This also translated into higher forestry harvesting and transportation expenses, as well as increased industrial costs related to energy and other key raw materials.

Speaker #3: Hardwood cash cost came in at $254 per ton, down 3% versus previous quarter, mainly the comparison against Q1 of this year's Guaiba's shutdown. Though wood cost rose on higher brand prices, higher DMT in Chile and the Brazilian reals appreciation, softwood cash cost rose 5% versus the Q1 of this year to $419 per ton, reflecting the Laja downtime and its ramp-up through June.

Diego Merino: Softwood cash costs rose 5% versus Q1 of this year to $419 per ton, reflecting the Laja downtime and its ramp-up through June. Next, let's discuss our Softys Business. Softys had a favorable quarter, driven mainly by stronger commercial dynamics in Brazil and Mexico, where both tissue and personal care posted higher sales and volumes versus both the prior quarter and last year. Sales reached $893 million, up 7% quarter over quarter and 9% year on year, with personal care at $437 million, up 13% versus Q1 of this year, and tissue at $456 million, up 2% versus Q1 2026. With personal care, diaper volumes were up 10% sequentially on strong performance in Brazil, Mexico, and Argentina, while feminine care and wipes also contributed to growth. EBITDA reached $101 million at an 11.3% margin, up 4% sequentially and 24% year on year.

Speaker #3: Next, let's discuss our Softys business. Softys had a favorable quarter, driven mainly by stronger commercial dynamics in Brazil and Mexico, where both tissue and personal care posted higher sales and volumes versus both the prior quarter and last year.

Speaker #3: Sales reached $893 million—up 7% Q2 over Q2 and 9% year-on-year—with Personal Care at $437 million, up 13% versus Q1 of this year, and Tissue at $456 million, up 2% versus Q1 2026.

Speaker #3: With personal care, diaper volumes were up 10% sequentially on strong performance in Brazil, Mexico, and Argentina. While feminine care and wipes also contributed to growth.

Speaker #3: EBITDA reached $101 million at an 11.3% margin, up 4% sequentially and 24% year-on-year, the sequentially improvement was driven by higher personal care sales—a favorable FX effect—and continued gains from our efficiency initiatives, this was achieved despite an estimated $10 million negative EBITDA impact from higher brand-related raw material and logistics costs year-on-year, the improvement mainly reflects the richer mix towards personal care and the positive FX effect.

Diego Merino: The sequential improvement was driven by higher personal care sales, a favorable FX effect, and continued gains from our efficiency initiatives. This was achieved despite an estimated -$10 million EBITDA impact from higher brand-related raw material and logistics costs. Year on year, the improvement mainly reflects the richer mix towards personal care and the positive FX effect. Next, let's discuss our Bio-packaging Business. Bio-packaging continued to operate in a challenging environment, particularly in boxboard segment, where continued oversupply from Asia kept pressuring selling prices across our markets. We stayed focused on revenue and profitability management, prioritizing margin over volume, and used commercial and mixed improvements in sack kraft and corrugated to partially offset that pressure.

Speaker #3: Next, let's discuss our bio packaging business. Bio packaging continued to operate in a challenging environment, particularly in the boxboard segment, where continued oversupply from Asia kept pressuring selling prices across our markets.

Speaker #3: We stayed focused on revenue and profitability management, prioritizing margin over volume, and used commercial and mix improvements in Sack Kraft and Corrugated to partially offset that pressure.

Diego Merino: Sales reached $251 million, up 2% versus previous quarter on higher folding boxboard volumes in Chile and Europe, and higher sack kraft exports to Mexico, but down 2% year on year on lower folding boxboard prices. EBITDA fell to $15 million, down 36% versus Q1 of 2026. Beyond the folding boxboard price pressure, corrugated volumes were affected by the end of the summer fruit season, a plant maintenance shutdown, and fixed costs related to a fire at the Papeles Cordillera plant.

Speaker #3: Sales reached $251 million, up 2% versus previous quarter, on higher folding box per volumes in Chile and Europe, and higher Sackcraft exports to Mexico, but down 2% year-on-year on lower folding box per prices.

Speaker #3: EBITDA fell to $15 million—down 36% versus the Q1 of 2026. Beyond the folding box per price pressure, corrugated volumes were affected by the end of the summer fruit season, a plant's maintenance shutdown, and fixed costs related to a fire at the Papeles Cordillera plant.

Sebastian Moraga: Thank you very much, Diego. We ended Q2 with net debt of $5 billion, net debt to EBITDA stands at 4.17x, up from 4.10x last quarter. As I mentioned earlier, we expect this ratio to decline progressively over the coming quarters, driven mainly by improved results and cash flow generation across our businesses. As I mentioned, we continue advancing our asset monetization program to further strengthen the balance sheet.

Sebastián Moraga: Thank you very much, Diego. We ended Q2 with net debt of $5 billion, net debt to EBITDA stands at 4.17x, up from 4.10x last quarter. As I mentioned earlier, we expect this ratio to decline progressively over the coming quarters, driven mainly by improved results and cash flow generation across our businesses. As I mentioned, we continue advancing our asset monetization program to further strengthen the balance sheet.

Speaker #1: Thank you very much, Diego. We ended the Q2 with net debt of $5 billion, net debt to EBITDA stands at $4.17 times, up from $4.10 times last quarter.

Speaker #1: As I mentioned earlier, we expect this ratio to decline progressively over the coming quarters, driven mainly by improved results and cash flow generation across our businesses.

Speaker #1: And as I mentioned, we continue advancing our asset monetization program to further strengthen the balance sheet.

Diego Merino: Thank you, Sebastian. Please recall that you're welcome to ask your question, just raising your hand in the chat box. Today we have Francisco Ruiz-Tagle, CEO of CMPC, Sebastian Moraga, CFO, Raimundo Varela, Vice President of Pulp and Boxboard, and Guilherme Viesi, Chief Commercial Officer of Pulp, in the call to answer your questions. First, we will start with Enrique Martinez from Goldman Sachs.

Diego Merino: Thank you, Sebastián. Please recall that you're welcome to ask your question, just raising your hand in the chat box. Today we have Francisco Ruiz-Tagle, CEO of CMPC, Sebastián Moraga, CFO, Raimundo Varela, Vice President of Pulp and Boxboard, and Guilherme Viesi, Chief Commercial Officer of Pulp, in the call to answer your questions. First, we will start with Enrique Martinez from Goldman Sachs.

Speaker #3: Thank you, Sebastian. Please recall that you're welcome to ask your questions. Just raising your hand in the chat box. And today we have Francisco Ruiz-Thales, CEO of CMPC.

Speaker #3: Sebastian Moraga, CFO; Raymundo Varela, Vice President of PALT and Boxport; and Guillermo Diezi, Chief Commercial Officer of PALT, are on the call to answer your questions.

Speaker #3: First, we will start with Enrique Martinez from Goldman Sachs.

Enrique Martinez: Hey, guys. Can you hear me now?

Enrick Martinez: Hey, guys. Can you hear me now?

Speaker #4: Hey, guys. Can you hear me now?

Diego Merino: Yes, Enrique.

Sebastian Moraga: Yes.

Sebastián Moraga: Yes.

Speaker #3: Yes, Enrique.

Enrique Martinez: Awesome. Thank you. Thank you for the time. Thank you for taking my questions. I have a couple questions. I think I'll start with the net debt position and asset sales. I think these are the most pressing ones. Just trying to understand here. Is there any target for you to reach in terms of net debt EBITDA before moving ahead with the Natureza project? If so, would you consider the 100% of the hybrid bond, only the part that is classified as debt? Just trying to understand here, what exactly is the metric of net debt EBITDA that you would look at considering the project of Natureza. Also, if you could remind us what the policy for net debt EBITDA is, that would be great. My second question regarding asset sale, just trying to understand here, what is the amount targeted for asset sale?

Enrick Martinez: Awesome. Thank you. Thank you for the time. Thank you for taking my questions. I have a couple questions. I think I'll start with the net debt position and asset sales. I think these are the most pressing ones. Just trying to understand here. Is there any target for you to reach in terms of net debt EBITDA before moving ahead with the Natureza project? If so, would you consider the 100% of the hybrid bond, only the part that is classified as debt? Just trying to understand here, what exactly is the metric of net debt EBITDA that you would look at considering the project of Natureza. Also, if you could remind us what the policy for net debt EBITDA is, that would be great. My second question regarding asset sale, just trying to understand here, what is the amount targeted for asset sale?

Speaker #5: Yes.

Speaker #4: Awesome, thank you. Thank you for your time and for taking my questions. I have a couple of questions. I think I'll start with the net debt position and asset sales.

Speaker #4: I think these are the most pressing ones. So just trying to understand here, is there any target for you to reach in terms of net debt, EBITDA, before moving ahead with the Notodesa project?

Speaker #4: And if so, I mean, would you consider the 100% of the hybrid bond only the part that is classified as debt? Just trying to understand here, what exactly is the metric of net debt, EBITDA, that you would look at considering the project of Notodesa?

Speaker #4: Also, if you could remind us what the policy for net debt EBITDA is, that would be great. And my second question, regarding asset sale, just trying to understand here, what is the amount targeted for asset sale?

Enrique Martinez: Is this a prerequisite for moving ahead with the Natureza project? Are you considering selling any of your operating assets, or would that be strictly non-core assets? That's it. Thank you, guys.

Enrick Martinez: Is this a prerequisite for moving ahead with the Natureza project? Are you considering selling any of your operating assets, or would that be strictly non-core assets? That's it. Thank you, guys.

Speaker #4: Is this a prerequisite for moving ahead with the Notodesa project? Are you considering selling any of your operating assets or would that be strictly non-core assets?

Speaker #4: That's it. Thank you, guys.

Sebastian Moraga: Enrique, I'll take the first question. Francisco, if you agree, you take the second question as Enrique. I'll go with the first question. Regarding our target, Enrique, it is stated that net financial debt to EBITDA between 2.5 and 3.5 times. As we mentioned in our analysis today, we are very well aware that we are deviated from that metric. Second question is how do we accounting to hybrid bonds? It's only that 4.17 times considers 50% equity contribution. That's where we end up with this number. Third is, how are we expecting this to evolve? Well, we commented that we are in the process of monetizing assets. I can let you know that we are, I would say, confident that the level of indebtedness of CMPC will evolve positively into the range that I just mentioned on the coming quarters.

Sebastián Moraga: Enrique, I'll take the first question. Francisco, if you agree, you take the second question as Enrique. I'll go with the first question. Regarding our target, Enrique, it is stated that net financial debt to EBITDA between 2.5 and 3.5 times. As we mentioned in our analysis today, we are very well aware that we are deviated from that metric. Second question is how do we accounting to hybrid bonds? It's only that 4.17 times considers 50% equity contribution. That's where we end up with this number. Third is, how are we expecting this to evolve? Well, we commented that we are in the process of monetizing assets. I can let you know that we are, I would say, confident that the level of indebtedness of CMPC will evolve positively into the range that I just mentioned on the coming quarters.

Speaker #2: Enrique, I'll take the first question. And Francisco, if you agree, you take the second question of Enrique. So I'll go with the first question.

Speaker #2: Regarding our targeted, Enrique, it is stated that net financial debt to EBITDA between $2.5 and $3.5 times. So as we mentioned in our analysis, today we are very well aware that we are deviated from that metric.

Speaker #2: Second question is, how do we account into hybrid bonds? It's only that 4.17 times. Considers 50% equity contribution and that's where we end up with this number.

Speaker #2: Third is, how are we expecting this to evolve? Well, we commented that we are on the process of monetizing assets. I can let you know that we are I would say confident that the level of indebtedness of CMPC will evolve positively into the range that I just mentioned on the coming quarters.

Sebastian Moraga: I cannot comment into detail on the advancement of monetization of assets. I can let you know that we are confident that in the coming quarters, we will be able to show that progress.

Sebastián Moraga: I cannot comment into detail on the advancement of monetization of assets. I can let you know that we are confident that in the coming quarters, we will be able to show that progress.

Speaker #2: I cannot comment into detail on the advancement of monetization of assets. But I can let you know that we are confident that in the coming quarters, we will be able to show that progress.

Diego Merino: Thank you, Sebastian. Next in line, we have.

Diego Merino: Thank you, Sebastián. Next in line, we have.

Speaker #3: Thank you, Sebastian. Next in line, we have—

Sebastian Moraga: Sorry, Diego. There was the B part of Enrique. I don't know if you want to take it, Francisco.

Sebastián Moraga: Sorry, Diego. There was the B part of Enrique. I don't know if you want to take it, Francisco.

Speaker #2: Sorry, Diego, there was the B part of Enrique. I don't know if you want to take it, Francisco.

Enrique Martinez: No, it's okay. I have no comment with your answer.

Francisco Ruiz-Tagle: No, it's okay. I have no comment with your answer.

Speaker #5: No, it's okay. I'm not coming with your answer.

Diego Merino: Okay. Thank you, Sebastian.

Diego Merino: Okay. Thank you, Sebastián.

Francisco Ruiz-Tagle: Thank you.

Enrick Martinez: Thank you.

Speaker #3: Okay. Thank you, Sebastian. Thank you, Sebastian. Next in line, we have Tatiane from JP Morgan.

Diego Merino: Next in line, we have Tatiane from JP Morgan.

[Analyst] (JP Morgan): Hi. Good morning, everyone. Can you hear me well?

[Analyst] (JPMorgan): Hi. Good morning, everyone. Can you hear me well?

Speaker #6: Hi. Good morning, everyone. Can you hear me well?

Diego Merino: Yes.

Sebastian Moraga: Yes.

Sebastián Moraga: Yes.

Sebastian Moraga: Okay. Thank you. Maybe just a follow-up on the previous question when it comes to the level of debt. When it comes to Natureza, I think the project was announced to the market a couple of years ago, and we had the CapEx, but a lot has changed since then. With all these moving parts, could we expect to see some new expectation when it comes to the CapEx amount? We know that there is some inflation in the industry, something that can also impact those numbers. If you are still comfortable with the level, as you mentioned, with the target that you are 2.5 until 3.5 to go ahead with the project, or in periods of investments, it would be comfortable to be above those levels. Maybe my second question, this is more for maybe Viesi on an update on the pulp industry.

[Analyst] (JPMorgan): Okay. Thank you. Maybe just a follow-up on the previous question when it comes to the level of debt. When it comes to Natureza, I think the project was announced to the market a couple of years ago, and we had the CapEx, but a lot has changed since then. With all these moving parts, could we expect to see some new expectation when it comes to the CapEx amount? We know that there is some inflation in the industry, something that can also impact those numbers. If you are still comfortable with the level, as you mentioned, with the target that you are 2.5 until 3.5 to go ahead with the project, or in periods of investments, it would be comfortable to be above those levels. Maybe my second question, this is more for maybe Viesi on an update on the pulp industry.

Speaker #3: Yes.

Speaker #6: Okay. Thank you. So maybe just like a follow-up on the previous question when it comes to the level of debt. When it comes to Notodesa, I think the project was announced to the market a couple of years ago, and we had the capex, but a lot has changed since then.

Speaker #6: So, with all these moving parts, could we expect to see some new expectations when it comes to the capex amount? We know that there is some inflation in the industry.

Speaker #6: Something that can also impact those numbers. And if you are still comfortable with the level, as you mentioned, with the target that you are $2.5 until $3.5 to go ahead with the project, or in periods of investments, it would be comfortable to be above those levels.

Speaker #6: And maybe my second question, this is more for maybe VSE on an update on the POP industry. We see that today announcements on resale prices, there is a lot of pressure when it comes to the hardwood prices in Latin America, in China, sorry.

[Analyst] (JP Morgan): We see that today announcements on resale prices, there is a lot of pressure when it comes to the hardwood prices in China. Just to understand overall what you kind of expect for pulp prices for the coming quarters, if you are positive on the expansion for 2027. Just an overall view on that. Thank you so much.

[Analyst] (JPMorgan): We see that today announcements on resale prices, there is a lot of pressure when it comes to the hardwood prices in China. Just to understand overall what you kind of expect for pulp prices for the coming quarters, if you are positive on the expansion for 2027. Just an overall view on that. Thank you so much.

Speaker #6: So just to understand that overall, what you kind of expect for POP prices for the coming quarters, if you are positive on the expansion for 2027, so just an overall view on that.

Speaker #6: Thank you so much.

Francisco Ruiz-Tagle: Thank you very much for your question. I can take it. Yes, as you said, we announced this project a couple of years ago, of course, we have been working in detail in all the engineer of this project and what this rate means in general, considering some extra investment in infrastructure. I can say that, of course, that we have some inflation in the period. We are not seeing any particular deviation compared with we announced at the beginning of the process. We haven't finished that process, we feel comfortable with the figures that we have announced in the past. In connection with your second question about Natureza and the range of our leverage, I would reaffirm what Sebastian said. I can say that this company is a really responsible company in terms of its leverage.

Francisco Ruiz-Tagle: Thank you very much for your question. I can take it. Yes, as you said, we announced this project a couple of years ago, of course, we have been working in detail in all the engineer of this project and what this rate means in general, considering some extra investment in infrastructure. I can say that, of course, that we have some inflation in the period. We are not seeing any particular deviation compared with we announced at the beginning of the process. We haven't finished that process, we feel comfortable with the figures that we have announced in the past. In connection with your second question about Natureza and the range of our leverage, I would reaffirm what Sebastián said. I can say that this company is a really responsible company in terms of its leverage.

Speaker #5: Thank you very much for your question. I can take it. Yes, as you said, we announced this project a couple of years ago. But of course, we have been working in detail in all the engineers of this project and all the what this means in general.

Speaker #5: Considering some extra investment in infrastructure. But I can say that, of course, we have some inflation in the period. We are not seeing any particular deviation compared with the we announced at the beginning of the process.

Speaker #5: We haven't finished that process, but we feel comfortable with the figures that we have announced in the past. And, in connection with the second question about Notodesa and the range of our leverage, I would reaffirm what Sebastian said.

Speaker #5: I can say that this company is a really responsible company in terms of its leverage. And of course, our target range is between $2.5 and $3.5.

Francisco Ruiz-Tagle: Of course, our target range is between 2.5 and 3.5, we will continue working on that, we have some processes that we expect to be really at least close to that range within the next quarters. I cannot tell you exactly what will be the point where we will decide about the Natureza.

Speaker #5: And we will continue working on that. And we have some processes that we expect to be really in that range at least close to that range within the next quarters.

Speaker #5: And but I cannot tell you that I mean, exactly that what will be the point where we will decide about the Notodesa.

Guilherme Viesi: Sebastian, I'll take the second question regarding market and prices for the future. I think we have to bear in mind we are in summer in the Northern Hemisphere. Summer, typically in China and in Europe tends to be rather quiet. July, August are the quietest of the months. Although in the second half of August, China tends to come back from their holidays and start picking up momentum. From a demand perspective, I think globally it's okay. Every market it's quite okay with the demand. Obviously, excluding Middle East, which is at the moment very complex situation. North America has a very good demand. Europe has a okay demand for the summer expected. China, similar. When it comes to prices, well, I would say the latest news we have been seeing regarding the Indonesian wildfires is likely to impact on the price and cost of wood chips worldwide.

Guilherme Viesi: Sebastián, I'll take the second question regarding market and prices for the future. I think we have to bear in mind we are in summer in the Northern Hemisphere. Summer, typically in China and in Europe tends to be rather quiet. July, August are the quietest of the months. Although in the second half of August, China tends to come back from their holidays and start picking up momentum. From a demand perspective, I think globally it's okay. Every market it's quite okay with the demand. Obviously, excluding Middle East, which is at the moment very complex situation. North America has a very good demand. Europe has a okay demand for the summer expected. China, similar. When it comes to prices, well, I would say the latest news we have been seeing regarding the Indonesian wildfires is likely to impact on the price and cost of wood chips worldwide.

Speaker #2: Tatiane, I'll take the.

Speaker #3: Second question. Regarding market and prices for the future. I think we have to bear in mind we are in summer in the northern hemisphere, summer typically in China, and in Europe, tends to be rather quiet.

Speaker #3: July, August are the quietest of the month. Although in the second half of August, China tends to come back from their holidays and start picking up momentum.

Speaker #3: So from a demand perspective, I think globally it's okay. Every market, it's quite okay with the demand. Obviously, excluding Middle East, which is at the moment very complex situation.

Speaker #3: North America has a very good demand. Europe has a okay demand for the summer expected. China similar. When it comes to prices, well, I would say that the latest news we have been seeing regarding the Indonesian wildfires is likely to impact on the price and cost of wood chips.

Speaker #3: Worldwide, I think these issues on wood chips coming from Indonesia have now been expanding for 12 months. It almost started with floods and then some logistics issues.

Guilherme Viesi: I think these issues on wood chips coming from Indonesia is now expanding for 12 months almost. It started with floods, and then some logistics issues. Now we have wildfires. We had the revocation of some licenses. This contributes to an increase in the cost of wood chips, which in turn contributes to the marginal cost of the pulp production in China, which reflects positively on pulp prices. We do expect pulp prices to start trending upwards, from here on towards the end of this year.

Speaker #3: Now we have wildfires. We had the revocation of some licenses. So this contributes to an increase in the cost of wood chips with, in turn, contributes to the marginal cost of the POP production in China.

Speaker #3: Which reflects positively on POP prices. So we do expect POP prices to start trending upwards from here on towards the end of this year.

[Analyst] (JP Morgan): Thank you, guys.

[Analyst] (JPMorgan): Thank you, guys. Just a follow-up question on your answer, Viesi. You mentioned a little bit the impact that Indonesia is suffering. Do you see any type of impact on El Niño? We see some companies preparing inventory for this time of the year. Do you also see any kind of impact, or are you preparing in any way for that as well? Thank you.

Guilherme Viesi: Thank you, guys.

Speaker #6: Thank you, guys. Thank you, guys. Thank you to follow.

[Analyst] (JP Morgan): Just a follow-up question on your answer, Viesi. You mentioned a little bit the impact that Indonesia is suffering. Do you see any type of impact on El Niño? We see some companies preparing inventory for this time of the year. Do you also see any kind of impact, or are you preparing in any way for that as well? Thank you.

Speaker #1: One more question on your answer, VSE. So, you mentioned a little bit the impact that Indonesia is suffering. Do you see any type of impact from El Niño?

Speaker #1: We see some companies preparing inventory for this time of the year. So do you also see any kind of impact, or are you preparing in any way for that as well?

Speaker #1: Thank you.

Guilherme Viesi: Well, El Niño has impacted a lot of companies, ourselves included. We have a lot of rain in the south of Chile here, where our mills are. In Rio Grande do Sul in Brazil, we have been affected by that as well. At the moment, without any production or sales impact, but it's definitely been a challenge for pulp production companies, and there is a lot of pulp production companies in the southern hemisphere. I would not be surprised if they are impacted.

Speaker #3: Well, El Niño has impacted a lot of companies, ourselves included. We have a lot of rain in the south of Chile here, where our mills are in Rio Grande do Sul, in Brazil.

Speaker #3: We have been affected by that as well. At the moment, without any production or sales impact, but it's definitely been a challenge for POP production companies.

Speaker #3: And there's a lot of POP production companies in the southern hemisphere. So I would not be surprised if they are impacted.

[Analyst] (JP Morgan): Thank you so much.

[Analyst] (JPMorgan): Thank you so much.

Speaker #1: Thank you so much.

Diego Merino: Thank you, Guilherme. Next in line is Matheus Moreira from Bradesco. Matheus?

Speaker #5: Thank you, Guilherme. Next in line is Mateus Moreira from Bradesco. Mateus.

Matheus Moreira: Yeah. Thanks, Diego. Good morning all, and thank you for taking my questions. My first question's on leverage, sorry to insist on this topic. You mentioned on the release that you expect leverage to trend down in the coming quarters, given expected stronger cash flow from operations. However, we have seen pulp prices decline in recent weeks while market conditions in both Tissue and Bio Packaging remain fairly challenging. I'm just wondering where should we expect the leverage coming from? Besides the asset monetization that you guys talked about earlier, is there any other initiative in place that could bring this leverage down in the near term? That's my first question. My second question, changing a bit gears here in the Tissue division. You delivered a strong quarter in Q2, with volumes increasing both on a Q-on-Q and year-over-year basis.

Speaker #4: Oh, yeah. Thanks, Diego. Good morning, all. And thank you for taking my questions. My first question is on leverage. And sorry to insist on this topic.

Speaker #4: But you mentioned on the release that you expect leverage to trend down in the coming quarters, given expected stronger cash flow from operations. However, we have seen pulp prices and conditions in both T2 and bio-packaging remain fairly challenging.

Speaker #4: I'm just wondering, where should we expect this leverage to come from? Besides the asset monetization that you guys talked about earlier, is there any other initiative in place that could bring this leverage down in the near term?

Speaker #4: So that's my first question. And then my second question, changing a bit, gears here in the tissue division. I mean, you delivered a strong quarter in Q2, right, with volumes increasing.

Speaker #4: Both on a Q and Q and year-over-year basis. I understand that market fundamentals are still very challenging, right? But have you seen any initial signs of recovery across your geographies?

Matheus Moreira: I understand that market fundamentals are still very challenging. Have you seen any initial signs of recovery across your geographies? Could you give us a broad overview on what you're seeing here in terms of supply, demand, and pricing for the coming quarters for the division? If I may squeeze in a very quick third question on the Natureza project. You guys gave an update on the project during the release. You guys have received a preliminary installation license. What are the key remaining milestones required before you can submit the project to board approval? When do you expect that for happening? Thank you very much.

Speaker #4: And could you give us a broad overview on what you're seeing here in terms of supply, demand, and pricing for the coming quarters for the division?

Speaker #4: And if I may squeeze in a very quick third question on the Notodesa project. I mean, you guys gave an update on the project during the release, right?

Speaker #4: You guys have received the preliminary installation license. What are the key milestones remaining milestones required to before you can submit the project to board approval?

Speaker #4: And when do you expect that for happening? Thank you very much.

Francisco Ruiz-Tagle: Matheus, let me take your first question. Yeah, you're right that we're seeing pulp prices trending a bit down. How are we expecting to bring down leverage? Well, I would repeat what we have been posting the last quarter, is basically a very strict use of cash. That translates into working capital initiatives, I would say, into revising our CapEx. You already saw that the CapEx of Q2 is lower than Q1, and you could see for the coming quarters that we are going to be strictly very efficient in the use of cash. That obviously helps to bring leverage down. Okay. There's another question about Tissue.

Sebastián Moraga: Matheus, let me take your first question. Yeah, you're right that we're seeing pulp prices trending a bit down. How are we expecting to bring down leverage? Well, I would repeat what we have been posting the last quarter, is basically a very strict use of cash. That translates into working capital initiatives, I would say, into revising our CapEx. You already saw that the CapEx of Q2 is lower than Q1, and you could see for the coming quarters that we are going to be strictly very efficient in the use of cash. That obviously helps to bring leverage down. Okay. There's another question about Tissue.

Speaker #3: Mateus, let me take your first question. Yes, you're right that we're seeing POP prices trending a bit down. And how are we expecting to bring down leverage?

Speaker #3: Well, I would repeat what we have been posting the last quarter is basically a very strict use of cash. And that translates into working capital initiatives, I would say, into revising our capex.

Speaker #3: You already saw that the capex of the second quarter is lower than the first. And you could see for the coming quarters that we are going to be strictly very efficient in the use of cash.

Speaker #3: And that is obviously that helps to bring leverage down, okay? There's another question about tissue.

Diego Merino: Francisco.

Speaker #2: Francisco.

Francisco Ruiz-Tagle: With the Tissue question. Well, the Tissue question, let me tell you that, yeah, regarding the market and the situation of the market we are participating in, I can say that, probably we are not seeing big changes compared with the last quarters. In terms of the market, still we are seeing an overcapacity in Brazil in terms of production. Probably, it is important, probably around 30% to 40% overcapacity in the industry Tissue. Even considering that, as I mentioned, Brazil is one of the main markets for CMPC. Even Mexico is another important market, as you know.

Speaker #5: With the tissue question, well, the tissue question, let me tell you that yeah, regarding the market and the situation of the market where participating in, I can say that probably we are not seeing big changes compared with the last quarters.

Speaker #5: But in terms of the market, still we are seeing a number of capacity in Brazil in terms of production probably it is important. Probably around 30, 40 percent overcapacity in the industry tissue.

Speaker #5: But even considering that, I mentioned Brazil as one of the main markets for CMPC. Even Mexico is another important market, as you know.

Diego Merino: Since we just lost Francisco, let's give him a few seconds. Okay. Here we have Francisco back.

Speaker #3: Since we just lost Francisco,

Speaker #5: let's give him a few seconds. Okay. Here we have Francisco back. Okay. Sorry about that. No. So what's telling that there was an in Brazil and Mexico main market for CMPC, we haven't seen important changes compared with the last quarter.

Francisco Ruiz-Tagle: Okay. Sorry about that. What I was telling that was in Brazil and Mexico, main market for CMPC, we haven't seen important changes compared with the last quarters. I can tell you that CMPC has done, or Softys has done important efforts in having very important improvements in operational cost and logistic cost. We're still seeing, probably between 30% and 40% industry overcapacity, in Brazil. Still, working hard in being a low-cost producer, increase our distribution network to reach new clients, to improve our point of sale execution. I would say working hard in improving that, and we are being successful during the last quarter in doing that. In Mexico, probably not too different a situation. Probably the market continues to present a challenging environment, because of the consumer behavior and the macroeconomic uncertainty.

Speaker #5: Last quarters, but I can tell you that CMPC has done, or Softys has done, important efforts in achieving very important improvements in cost, operational cost, and logistic cost.

Speaker #5: We're still seeing probably between 30 and 40 percent industry overcapacity in Brazil, but still working hard on being a low-cost producer, increasing our distribution network to reach new clients, and improving our point-of-sale execution.

Speaker #5: So I would say working hard in improving that. And we are being successful during the last quarter in doing that. And Mexico probably not too different the situation.

Speaker #5: Probably, the market continues to present a challenging environment because of consumer behavior and macroeconomic uncertainty. We're experiencing some specific pressure in Baby Diapers, where we invested in the past.

Francisco Ruiz-Tagle: We're experiencing some specific pressure in baby diapers, where we invested in the past. Still working in improving logistic and cost in that market. We are challenged for that market because of high competition and good competition there. Basically doing an important job internally. This is one of the reasons I'm working really aligned with our people and in terms of improving this business in a kind of a very competitive market. With decision, we have been working with McKinsey in some of the parts of our businesses, and I would say we've good plans on that. In terms of the next question you asked, it was connected with Natureza and the key milestone and a more specific definition of the project. What I can say, we're still working in the licensing process.

Speaker #5: But we're still working on improving logistics and costs in that market. We are challenged in that market because of high competition and good competitors there.

Speaker #5: But basically doing an important job internally. And so this is one of the reasons and working really aligned with our people and in terms of improving this business in a kind of a very competitive market.

Speaker #5: But with decision, we have been working with McKinsey, some of the part of our businesses, and I would say with plans on that. And in terms of the next question you asked, it was connected with Notodesa and the key milestone and the more specific definition of the project.

Speaker #5: What I. Is that we're still working in the licensing process. We have been it took a bit more time compared with what we considered at the beginning because we had some extra question or extra work to do with the indigenous communities in the region.

Francisco Ruiz-Tagle: It took a bit more time compared with what we considered at the beginning, because we had some extra questioning or extra work to do with the indigenous communities in the region. Some extra studies that consider at the beginning, it took more time. I would say the licensing process, the previous license, which is the next step, actually, continue in the process according with the Brazilian law and FEPAM and FUNAI, who are the main institution behind approving this project from the environmental and social standpoint. They continue with the process, even considering that there is a federal prosecutor in Rio Grande do Sul that started a civil action asking us to either the studies of indigenous impact, basically, in almost the whole state, which is actually not considered by the law.

Speaker #5: Some extra studies that compare with considered at the beginning. It took more time. But I would say the licensing process, the previous license, which is the next step actually, continue in the process according with the Brazilian law.

Speaker #5: And FEPAM and FUNAI, who are the main institution behind approving this project from the environmental and social standpoint, they continue with the process. Even considering that we of course there is a kind of federal prosecutor in Rio Grande do Sul that started a civil action asking us to either the studies of indigenous impact basically in the whole state almost the whole state, which is actually not considered by the law.

Francisco Ruiz-Tagle: What the main institution in Brazil, which is FEPAM and FUNAI, in that sense, they have continued doing that because they haven't found anything, any illegal or incorrect things in our process. We have been really careful about, I would say, step by step and working hard in all the steps we need to approve this. In terms of when, I can tell you that for this moment, we are living in a moment that we are working in the process of having these approvals. As we said before, working in our balance sheet and in a monetization process. We will see probably a Q2 better compared with Q1, because we had some instability in production in part during Q1 that affected, in some ways, our cash.

Speaker #5: So what the main institution in Brazil, which is FEPAM and FUNAI in that sense, they have continued doing that because they haven't found anything and any illegal or incorrect things in our process.

Speaker #5: We have been really careful about I would say step by step and working hard in all the steps we need to approve this. So and in terms of when, I can tell you that we are for this moment, we are living in a moment that we are working in the process of having this approvals.

Speaker #5: And as we said before, we're working on our balance sheet and on a monetization process, and we will probably see a second quarter better compared with the last quarter, because we had some instability in production in part during the first quarter that affected, in some way, our cash.

Francisco Ruiz-Tagle: We will see a better H2 for tissue, a better H2, even considering some reduction in pulp prices. Probably would have a better H2 in terms of cash flow, today expecting a better H2 compared with H1. I can't tell you any specific moment for the approval of the project.

Speaker #5: We will see a better second semester for tissue. A better second semester, even considering some reduction in pump prices, probably would have a better in terms of cash would be we are expecting a better today, expecting a better second semester compared with the first half of the year.

Speaker #5: But I can't tell you any specific moment for the approval of the project. That's very clear, with a lot of detail. Thank you very much, Sebastian Diego.

Matheus Moreira: That's very clear with a lot of detail. Thank you very much, Sebastian, Diego, and Francisco.

Matheus Moreira: That's very clear with a lot of detail. Thank you very much, Sebastián, Diego, and Francisco.

Speaker #5: And Francisco.

Diego Merino: Thank you, Matheus. Next in line, we have Marcelo Furlan from Itaú. Marcelo.

Speaker #1: Thank you, Mateus. Next in line, we have Marcelo Furlan from Itaú. Marcelo.

Marcelo Furlan: Hi, everyone. Good morning. Can you hear me?

Speaker #6: Hi, everyone. Good morning. Can you hear me?

Diego Merino: Yes.

Marcelo Furlan: Okay. Thank you so much, guys.

Speaker #1: Yes.

Diego Merino: Good morning.

Speaker #6: Okay, thank you so much, guys.

Marcelo Furlan: Sorry to insist on the Natureza's questions, related questions. If I'm not mistaken, when Natureza was announced, the market, the potential project, we had a different perspective for the long-term dynamics for the market pulp industry. Many things has changed since then, especially with this more challenging scenario with the integrated and capacities in China, and so on and so forth. Since then, I'd like to understand what is behind synthesis management regarding being confident that this project should move forward. Do you guys have maybe a more bullish view regarding the long-term market dynamics, or does this project have a differentiation cost structure that makes you confident that this project should move? I would like to understand what's behind for you guys to be optimistic that this project should move within the company.

Speaker #7: Good morning.

Speaker #6: Through to insist on the Notodesa's questions related questions. But if I'm not mistaken, when Notodesa was announced the market, the potential project, we had a different perspective, right, from the long-term dynamics for the market industry.

Speaker #6: And many things had changed since then, especially with this more challenging scenario with the integrated and capacity additions in China and so on and so forth.

Speaker #6: So since then, I'd like to understand what is behind maybe what is behind management CMPC's management regarding being confident that this project should move forward.

Speaker #6: So I mean, do you guys have maybe a more bullish view regarding the long-term market dynamics, or does this project have differentiated cost structure that makes you confident that this project should move?

Speaker #6: So I would like to understand what is behind of for you guys to be optimistic that this project should move within the company.

Francisco Ruiz-Tagle: Well, thank you for your question. My answer to that is that, as we said before, there are some considerations for approving this project, licensing, the balance sheet, et cetera. What we see in the project itself is that at CMPC, we believe that we have a very competitive project. It's a project with advantages and costs for, I would say, two aspects. One is in the forest costs. In general, I think we have a very good growth of forest in the region, per hectare per year. It's an important advantage there. Also logistics cost is very interesting. From the standpoint, what we have in CMPC is a very interesting project. I would say that's mainly the fundamentals for this. Of course, also we have been participating in the markets, in the pulp market for several years.

Speaker #7: Okay. Well, thank you for your question. My answer to that is that as I. As we said before. There are some considerations for approving this project, licensing, the balance sheet, etc.

Speaker #7: But what we see in the project itself is that at CMPC, we believe that we have a very competitive project. It's a project with good advantages in cost for, I would say, two aspects.

Speaker #7: One is a forest cost in general. It's a we have a good a very good growth of forest in the region, per hectare, per year.

Speaker #7: It's an important advantage there. And also, logistic cost is very interesting. So from that standpoint, what we have in CMP is a very interesting project.

Speaker #7: So I would say that's mainly the fundamental for this. And of course, also we have been participating in the markets in the pump market for several, several years.

Francisco Ruiz-Tagle: CMPC is a well-respected company, with connections with customers. We see good potential. This is basically my answer. Of course, we're totally convinced with the Natureza project, considering what I mentioned.

Speaker #7: CMPC is a very y well-respected company. So with connection with customers and so we see good potential. And this is basically my answer. And of course, so we are totally convinced with the Notodesa project considering what we what I mentioned.

Raimundo Varela: On that subject, I can add that, of course, we monitor what's happening in China. Now, the increase in integration they have had. However, high quality pulp will be needed. China is a very large importer of pulp. We think that will continue to happen. We have mentioned before that China's growth in pulp imports will decrease, but they will continue to grow at a lower rate, but high quality pulp will be needed in China. In other regions around the world. As Francisco mentioned, if you have a very competitive project, and you think that the market will continue to grow as a whole, the market, we think, will continue to grow the same than before. China will grow less, but other regions will compensate that. That's basically the logic behind.

Speaker #2: On that subject, I can add that of course, we monitor what's happening in China, the increase in integration they've had. However, high-quality pump will be needed.

Speaker #2: China is a very large importer of pumps. We think that will continue to happen. We have mentioned before that China's growth in pump imports will decrease, but they will continue to grow at a lower rate. However, high-quality pumps will be needed in China.

Speaker #2: And in other regions around the world. So as Francisco mentioned, if you have a very competitive project, and you market, we think, will continue to grow the same than before.

Speaker #2: China will grow less, but other regions will compensate for that. So that's basically the logic behind it.

Marcelo Furlan: Okay. Thank you so much, guys.

Speaker #6: Okay. Thank you so much, Harris.

Diego Merino: Thank you, Marcelo. Next in line, we have Guilherme Rosito from Bank of America. Guilherme, you there?

Speaker #1: Thank you, Marcelo. Next in line, we have Guilherme Rosito from Bank of America. Guilherme, you there?

Guilherme Rosito: Yes. Thanks, Diego. Good morning, everyone. Thank you for taking my question. My first one is on Natureza, I'm sorry to keep on that, Francisco mentioned that there are some considerations to the project, as far as you can tell us, if we come and have all the licenses, everything, what would weigh more for you not to go ahead with the project, since you seem very excited with the prospect and the economics of it? Would it be the balance sheet? Would it be maybe we come to a third year without a capacity increase and prices haven't been able to move past $600 for hardwood, then we have this huge wave of capacity coming, maybe you think it's better to wait some time and put it another.

Speaker #4: Yes. Thanks, Diego. Good morning, everyone. Thank you for taking my question. So my first one is on Notodesa and I'm sorry to keep on that, but Francisco mentioned that there are some considerations to the project and as far as you can tell us, if we come in to have all the licenses, everything, what would weigh more for you not to go ahead with the project since you seem very excited with the prospect and the economics of it?

Speaker #4: Would it be the balance sheet? Would it be maybe we come to a third year without a capacity increase and prices haven't been able to move past $600 for hardwood?

Speaker #4: And then we have this huge wave of capacity coming. Maybe you think it's better to wait some time and put it in another just trying to pick your brains and understand what could eventually delay the approval of the project.

Guilherme Rosito: Just trying to pick your brains and understand what could eventually delay the approval of the project. I understand that we're very excited in the economics, just trying to understand what those considerations might be. The second to Guilherme, do you feel that this is the pulp price bottom for this cycle right now? Are you feeling that after the recent decreases, intake has come back to normal? Are you feeling more appetite from buyers to feel like this is the bottom or maybe we can expect another leg down before we actually reach the bottom of the cycle? Thank you.

Speaker #4: Because I understand that we're very excited about the economics, but I'm just trying to understand what those considerations might be. And second, for Guilherme: do you feel that this is the pump price bottom for this cycle right now?

Speaker #4: Are you feeling that, after the recent decreases, intake has come back to normal? Or are you seeing more appetite from buyers? Do you feel like this is the bottom, or maybe we can expect another leg down before we actually reach the bottom of the cycle?

Speaker #4: Thank you.

Raimundo Varela: Sorry, I was mute first part of your question. Can you hear me? Sorry.

Francisco Ruiz-Tagle: Sorry, I was mute first part of your question. Can you hear me? Sorry.

Speaker #7: So well, I would say the first part of your question, can you hear me? Sorry. Yes, I can hear you. Okay. Well, first part of your question, what could delay the project?

Guilherme Rosito: Yes, I can hear you.

Raimundo Varela: Well, first part of your question, what could delay the project? I believe that we already answered that. Sorry about that. In the sense that we have mentioned that we are in a process of monetization, we are in a process of licensing, and we have, of course, we will take the decision in a responsible way. That's my answer for that. We already mentioned that we have a target in net debt to EBITDA, and I can't be too precise what is the point. We will not take any irresponsible decision. This is my answer.

Francisco Ruiz-Tagle: Well, first part of your question, what could delay the project? I believe that we already answered that. Sorry about that. In the sense that we have mentioned that we are in a process of monetization, we are in a process of licensing, and we have, of course, we will take the decision in a responsible way. That's my answer for that. We already mentioned that we have a target in net debt to EBITDA, and I can't be too precise what is the point. We will not take any irresponsible decision. This is my answer.

Speaker #7: I believe that we already answered that. Sorry about that. And in the sense that we have mentioned that we are in a process of monetization, we are in a process of licensing, and we are, of course, we will take the decision in a responsible way.

Speaker #7: So that's my answer for that. We already mentioned that we have a target in net debt to EBITDA, and I can't be too precise as to what that point is.

Speaker #7: But we will not take any irresponsible decision. This is my answer.

Guilherme Viesi: Guilherme, I'll take your second question. It's very difficult to answer whether we reached the bottom or not. I believe so. I believe that from here on, we have reasons to believe that the prices should start picking up. One of the reasons I've already mentioned, which is the cost of wood chips in Asia, that has a quite relevant impact on the cost of production in China. A second one, we have seen several announcements of closures, planned and unplanned, definitive or temporary, mainly in the softwood side in North America, in Scandinavia, in Europe, mainland. We believe that trending in the right direction is not yet sufficient to have a meaningful correction on the softwood supply-demand ratio. We believe there is still way to go in terms of closures there. With the current prices of softwood, this trend will only continue.

Speaker #1: And Guilherme, I'll take your second difficult to answer whether we reach the bottom or not. I believe so. I believe that from here on, we have reasons to believe that the prices should start picking up.

Speaker #1: One of the reasons I've already mentioned, which is the cost of wood chips in Asia, has a quite relevant impact on the cost of production in China.

Speaker #1: A second one, we have seen several announcements of closures, planned and unplanned, definitive or temporary, mainly on the softwood side, in North America and in Scandinavia.

Speaker #1: In Europe, mainland. So we believe that trending in the right direction is not yet sufficient to have a meaningful correction on the softwood supply-demand ratio.

Speaker #1: We believe there's still way to go in terms of closures there. But with the current prices of softwood, this trend will only continue. And lastly, I would say the Q4 of the year is a very strong month in terms of demand.

Guilherme Viesi: Lastly, I would say the Q4 of the year is a very strong month in terms of demand. If you take historically, prices tend to go up during the last quarter of the month. With all of those factors combined, it will lead me to believe that yes, we have reached the bottom. We still have, let's say a couple of weeks of August still that could potentially have a minor change downwards, I believe that from here on, prices should start moving upwards.

Speaker #1: If you look at it historically, prices tend to go up during the last quarter of the month. So, with all of those factors combined, it leads me to believe that yes, we have reached the bottom.

Speaker #1: I mean, we still have the, let's say, a couple of weeks of August still that could potentially have a minor change downwards, but I believe that from here on, prices should start moving upwards.

Guilherme Rosito: Thank you so much, Francisco and Guilherme. Super clear.

Speaker #4: Thank you so much, Francisco. Super clear.

Diego Merino: Thank you, Guilherme. Next in line is Jure Tudzarova from LarrainVial. Please bear in mind that to be able to answer all your questions, if you have any additional questions regarding Natureza, we can contact you later on this meeting, so we can answer as most questions as possible. Okay? Thank you. Jure, it's you.

Speaker #1: Thank you, Guilherme. Now, next in line, is Juraj Domić from La Rainbial. And please bear in mind that to be able to answer all your questions, if you have any additional question regarding Notodesa we can contact you later on this meeting.

Speaker #1: So we can answer as many questions as possible, okay? Thank you. Juraj, it's your turn.

Jure Tudzarova: Hello. Good morning. You can hear me, right?

Juraj Domic: Hello. Good morning. You can hear me, right?

Speaker #5: Hello. Hello. Good morning. You can hear me, right? Yes. Okay. Perfect. So I just wanted to confirm if the sorry, we observed an increase in production that was not followed by sales volumes in bulk.

Diego Merino: Yep. Yes.

Jure Tudzarova: Okay, perfect. We observed an increase in production that was not followed by sales volumes in pulp. I just wanted to confirm if this was related to the market seasonality that you mentioned earlier. One more question, if the operations in southern Chile have continued normally with the recent rain events, either operations or shipments or logistics, any of the sort. Thank you.

Juraj Domic: Okay, perfect. We observed an increase in production that was not followed by sales volumes in pulp. I just wanted to confirm if this was related to the market seasonality that you mentioned earlier. One more question, if the operations in southern Chile have continued normally with the recent rain events, either operations or shipments or logistics, any of the sort. Thank you.

Speaker #5: So I just wanted to confirm if this was related to the market seasonality that you mentioned earlier. And one more question: if the operations in southern Chile have continued normally with the recent rain events.

Speaker #5: Either operations, shipments, or logistics—any of that sort. Thank you.

Raimundo Varela: I think our stocks were very low. Basically we have recovered a little bit of our stocks so that we can serve our customers according to the level that we commit. That is part of our characteristic as a good supplier. We are happy with our level of sales and our level of stocks now. We were a bit low in stocks before. Service level is very important in an industry like this. Yes, our mills have continued to operate normal in the south of Chile and also in Brazil, despite the difficult conditions. There is a bit of issues on the logistics going from the forest into the mill and from the mill into the ports, but nothing that interrupt the production.

Speaker #2: I think our stocks were very low, so basically, we have recovered a little bit of our stocks so that we can serve our customers according to the level that we commit.

Speaker #2: And that is part of our characteristic as a good supplier. So we are happy with our level of sales and our level of stocks now.

Speaker #2: We were a bit low in stocks before. So service level is very important in an industry like this. And yes, our mills have continued to operate normal in the south of Chile and also in Brazil.

Speaker #2: Despite the difficult conditions, there is a bit of issues on the logistics going from the forest into the mill and from the mill into the ports.

Speaker #2: But nothing that interrupt the production.

Jure Tudzarova: Okay, perfect. Thank you very much.

Juraj Domic: Okay, perfect. Thank you very much.

Speaker #5: Okay, perfect. Thank you very much.

Diego Merino: Thank you, Raimundo. Next in line, we have Alfonso Salazar from Scotiabank. Alfonso?

Speaker #1: Thank you, Raimundo. Next in line, we have Alfonso Salazar from Scotiabank. Alfonso, end. The first one is regarding what you mentioned. About the demand being okay globally.

Alfonso Salazar: A couple of questions from my end. The first one is regarding what you mentioned about the demand being okay globally. Just wanted to hear your thoughts on what's going on and the outlook for China and Europe. We understand that North America has been strong. How do you see these two markets evolving over time? Perhaps the concern with China is that we know that the population is in a downtrend already, that many people will retire shortly in a very low pension. Is this increase in demand that you see for own consumption, is it going to be for the export markets becoming more like a competitor in the exporting paper? The second question that I have is regarding CapEx guidance. You mentioned that you will be more strict spending in H2.

Speaker #1: Just wanted to hear what's going on in your thoughts on what's going on and the outlook for China and Europe. We understand that North America has been strong.

Speaker #1: But how do you see these two markets evolving over time? Perhaps the concern that a population is in a downtrend already. Many people will retire shortly in a very low pension.

Speaker #1: So is this increasing demand that you see for own consumption? Is it going to be for the export markets—becoming more like a competitor in the export and paper, exporting paper?

Speaker #1: And the second question that I have is regarding CapEx guidance. You mentioned that you will be more strict with spending in the second half of the year.

Alfonso Salazar: Is there any change to your CapEx guidance for the year? Thank you.

Speaker #1: Is there any change to your CapEx guidance for the year? Thank you.

Raimundo Varela: The first one, I think China is a country that continue to develop. We are present there very often, and we have people there, and myself, Guilherme, Francisco, go there a couple of times a year. The country keep developing. The main driver for demand is middle class, and China expect to have continue people joining middle class. They expect another 400 million people to join middle class in the next 10 years. That is where the bigger demand for consumer products and paper products is coming. Another driver for demand in the medium term is what we call the de-integration. In the world of pulp and paper, you have a huge amount of integrated pulp production in the US, in Canada, in Europe. Some of that is with very old assets in the pulp part.

Speaker #6: I think the first one, I think China is a country that continues to develop.

Speaker #2: We are present there very often, and we have people there. And myself, Guilherme, Francisco, go there a couple of times a year. So the country keeps developing.

Speaker #2: And the main driver for demand is middle class. And China expect to have a continue people joining middle class. They expect another 400 million people to join middle class in the next 10 years.

Speaker #2: And that is where the greater demand for consumer products and paper products is coming from. Then, another driver for demand in the medium term is what we call deintegration.

Speaker #2: So in the world of pulp and paper, you have a huge amount of integrated pulp production in the US, in Canada, in North America, in Europe.

Speaker #2: And some of that is with very old assets, in the pulp part. And we believe, and we are already seeing some examples of companies who are deciding to stop their pulp mills and buy pulp from the market.

Raimundo Varela: We believe, and we are already seeing some examples of companies who are deciding to stop their pulp mills and buy pulp from the market. We believe that trend will probably continue, that, again, that is a big opportunity. You also have the fiber to fiber substitution, which Guilherme mentioned. Softwood is structurally complicated. Oversupply with, again, very high cost in the northern hemisphere. Some adjustment will happen there, no doubt. Also that provide an opportunity for hardwood. That with the hardwood is very competitive in production with our current assets and we expect also with Natureza. Those are the key things we believe will sustain the demand for our products. Regarding your second question on CapEx guidance, no, we cannot disclose CapEx guidance.

Speaker #2: We believe that trend will probably continue and that again, that is a big opportunity. And then you also have the fiber-to-fiber substitution. Which Guilherme mentioned, software is structurally complicated.

Speaker #2: Oversupply with again, with a very high cost in the northern hemisphere. e. And so some adjustment will happen there, no doubt. And also that provide an opportunity for hardwood that with the hardwood is very competitive in production.

Speaker #2: With the assets, with our current assets, and we expect also with Notodesa. So those are the key things we believe will sustain this demand for our products.

Sebastián Moraga: Regarding your second question on CapEx guidance, no, we cannot disclose CapEx guidance. What I can let you know is that we already showed the result of the Q1 CapEx versus the Q2. What I can convey is that you will keep on going, seeing efficiencies throughout the next quarters.

Speaker #6: Regarding your.

Speaker #3: Second question on capex guidance. No, we cannot disclose capex guidance, but what I can let you know is that you already we already showed the results of the first quarter capex versus the second one.

Sebastian Moraga: What I can let you know is that we already showed the result of the Q1 CapEx versus the Q2. What I can convey is that you will keep on going, seeing efficiencies throughout the next quarters.

Speaker #3: And what I can convey is that you will keep on seeing efficiencies throughout the next quarters.

Alfonso Salazar: Fair enough. Thank you.

Speaker #5: Fair enough. Thank you.

Speaker #6: Fair enough. Thank you.

Diego Merino: Thank you, Sebastian and Raimundo. Now for the last question, we have Ricardo Monegaglia from Safra. Ricardo?

Diego Merino: Thank you, Sebastián and Raimundo. Now for the last question, we have Ricardo Monegaglia from Safra. Ricardo?

Speaker #1: Thank you, Sebastian and Raimundo. And now for the last question, we have Ricardo Monegalia from Safra. Ricardo, I think you can, right? Yes, we can hear you.

Ricardo Monegaglia: Hello, guys.

Ricardo Monegaglia: Hello, guys. I think you can, right?

Diego Merino: I think you can, right?

Raimundo Varela: Yes, we can hear you.

Ricardo Monegaglia: Cool. Thank you for the opportunity. I have a couple of quick questions. First one, just wanted to hear your thoughts on China forestry industry. We are hearing a lot of discussions if the country could, in fact, increase the productivity of its forestries. We are hearing that the country is trying to get more investment on specific provinces to really become a producer and maybe even exporter of wood and forestry. Just wanted to hear your thoughts on that. What are the main challenges you think they will have by doing that? My second question on the leverage plan, if you could just remind us what is on the table when you think on the leverage. What kinds of assets do you think are in the table currently?

Speaker #1: Cool, thank you for the opportunity. I have a couple of quick questions. First one: I just wanted to hear your thoughts on the China forestry industry.

Speaker #1: We are hearing a lot of discussions about whether the country could, in fact, increase the productivity of its forests. We are also hearing that the country is trying to get more investment in specific provinces.

Speaker #1: To really become a producer and maybe even an exporter of wood and forestry. So I just wanted to hear your thoughts on that. What are the main challenges you think they will face by doing that?

Speaker #1: And my second question is on the leverage plan. If you could just remind us what is on the table when you think about the leverage.

Speaker #1: What kinds of assets you think are in the table currently? And I just as a compliment, do you think that all of your pulp assets are required when you think on the whole structure of the pulp sector?

Ricardo Monegaglia: Just as a complement, do you think that all of your pulp assets are required when you think on the whole structure of the pulp sector? Like the outlook that is not ideal for high cost producers. Not saying that some of your operations aren't high cost producers, but some of them are not huge as we are seeing currently and with Natureza as well. Yeah, broad question, but just wanted to hear you on that.

Speaker #1: Like the outlook, that is not ideal for high-cost producers. Not saying that some of your operations aren't high-cost producers, but some of them are not huge, as we are seeing currently.

Speaker #1: And with Notodesa as well. So yeah, broad question, but just wanted to hear you on that.

Raimundo Varela: The first part regarding China forestry, we have done quite a lot of work over the last 2 years to have a deeper understanding of the Chinese forestry industry. There is no doubt that they have grown eucalyptus plantations over the last 10, 15 years. They have been growing that. What we hear on the ground is that they do have limited capacity to continue doing that, given the land, and how they dedicated the land to food, and to other uses. They could grow a bit more, but I think the number was something like 600,000 hectares of more growth. Beyond that, it is difficult. No doubt that they have been using also the downturn in construction in the country to use that surplus wood. That will probably continue for a few more years.

Speaker #2: Regarding the first part about China forestry, we have done quite a lot of work over the last two years to gain a deeper understanding of the Chinese forestry industry.

Speaker #2: There's no doubt that they have grown. Eucalyptus plantations over the last 10 or 15 years, they have been growing that. What we hear on the ground is that they do have limited capacity to continue doing that, given the availability of land and how they have dedicated the land to food and to other uses.

Speaker #2: So they could grow a bit more, but I think the number was something like 600,000 hectares of more growth. But beyond that, it's difficult.

Speaker #2: No doubt that they have also been using the downturn in construction in the country to use that surplus wood. So that will probably continue for a few more years.

Raimundo Varela: That is enough to supply what they have today and what they are building. We do not expect under any circumstances China to become an exporter of wood or an exporter of pulp. We have not heard that is their intention at all. There is no doubt that they do have a surplus of paper or installed paper capacity. That is a problem, I would say, at the end of the day, and as a consequence of that, they have a difficulty increasing paper price, even though they have fantastic facilities. They produce great paper, but they have a difficulty increasing the paper prices in the local market, and they also export at relatively low prices. That is an issue and affects our own paper and other paper companies around the world. We have not yet seen a lot of, I would say, discipline on that, on producing less, basically.

Speaker #2: But that is enough to supply what they have today and what they are building. We do not expect, under any circumstances, China to become an exporter of wood or an exporter of pulp.

Speaker #2: I don't think we have heard that that's their intention at all. There's no doubt that they do have a surplus of paper, or installed paper capacity.

Speaker #2: That is a problem, I would say, at the end of the day. And they, as a consequence of that, have difficulty increasing paper prices, even though they have fantastic facilities.

Speaker #2: They produce great paper, but they have difficulty increasing paper prices in the local market. And they also export at relatively low prices, which is an issue and affects our own paper and other paper companies around the world.

Speaker #2: We haven't yet seen a lot of, I would say, discipline on that, on producing less, basically. Some signs of that, but not enough. We believe that that will eventually happen.

Raimundo Varela: Some signs of that, but not enough. We believe that that will eventually happen. Maybe some consolidation also within the Chinese paper industry. It might happen in the next few years.

Speaker #2: Maybe some consolidation also within the Chinese paper industry, maybe it might happen in the next few years.

Sebastian Moraga: You want to take the second question?

Sebastián Moraga: You want to take the second question?

Speaker #3: Do you want to take the second question?

Raimundo Varela: You take the second question.

Speaker #1: Do you take the second question?

Sebastian Moraga: Okay. Ricardo, regarding what's on the table, I would say, as we have mentioned, it's mainly what you can see on our balance sheet, and we have been mentioning our forestry base. That is, I would say, what we have disclosed publicly, and I would like to stick to that.

Sebastián Moraga: Okay. Ricardo, regarding what's on the table, I would say, as we have mentioned, it's mainly what you can see on our balance sheet, and we have been mentioning our forestry base. That is, I would say, what we have disclosed publicly, and I would like to stick to that.

Speaker #3: Okay. So Ricardo, regarding what's on the table, I would say, as we have mentioned, it's mainly what you can see on our balance sheet.

Speaker #3: And we have been mentioning our forestry base. That is, I would say, what we have disclosed publicly, and I would like to stick to that.

Raimundo Varela: All right. Thank you.

Ricardo Monegaglia: All right. Thank you.

Speaker #1: All right. Thank you. All right. Thank you. Okay. In that case, I believe that will be all. Thank you, everyone, again, for joining our second quarter 2026 earnings presentation.

Diego Merino: Okay. In that case, I believe that will be all. Thank you everyone again for joining our Q2 2026 earnings presentation. See you again next quarter.

Speaker #1: See you again next quarter.

Sebastian Moraga: Thank you very much for your question and for your participation.

Sebastián Moraga: Thank you very much for your question and for your participation.

Speaker #4: Thank you very much for your question and for your participation.

Raimundo Varela: Bye-bye.

Speaker #3: Bye-bye.

Operator 2: Goodbye.

Browse all earnings call transcripts

Q2 2026 Empresas CMPC SA Earnings Call

Request TrialDemo

CMPC

Earnings