UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of September, 2023.
Commission File Number 001-38755
(Exact name of registrant as specified in its charter)
SUZANO INC.
(Translation of Registrant’s Name into English)
Av. Professor Magalhaes Neto, 1,752
10th Floor, Rooms 1010 and 1011
Salvador, Brazil 41 810-012
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
EXPLANATORY NOTE
Suzano is amending its report on Form 6-K furnished to the Securities and Exchange Commission on August 2, 2023 (File/FilmNumber: 001-38755 / 231136862) (the “Original 6-K”) solely for the purpose of replacing Exhibit 99.1, which contains our Unauditedcondensed consolidated interim financial information as of June 30, 2023, and adding Exhibit 101, which contains Interactive Data Filedisclosure in accordance with Rule 405 of Regulation S-T. Except as described above, this amendment does not amend any information setforth in the Original 6-K.
This report and exhibits shall be deemed to be incorporated by reference in our registration statements on Form F-3 filed with the U.S. Securities and Exchange Commission on September 18, 2020 (File No. 333-248909), and shall be deemed to be a part thereof from the date onwhich this report is furnished to the SEC, to the extent not superseded by documents or reports subsequently filed or furnished.
2
EXHIBIT INDEX
Exhibit | |
Exhibit 99.1 | Unaudited condensed consolidated interim financial information as of June 30, 2023. |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Schema Calculation Linkbase |
101.DEF | XBRL Taxonomy Extension Schema Definition Linkbase |
101.LAB | XBRL Taxonomy Extension Schema Label Linkbase |
101.PRE | XBRL Taxonomy Extension Schema Presentation Linkbase |
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: September 26, 2023
SUZANO S.A. | ||
By: | /s/ Marcelo Feriozzi Bacci | |
Name: | Marcelo Feriozzi Bacci | |
Title: | Chief Financial and Investor Relations Officer |
4
Exhibit 99.1
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED BALANCE SHEET
June 30, | December 31, | |||||
| Note |
| 2023 |
| 2022 | |
ASSETS |
|
|
|
|
|
|
CURRENT |
|
|
|
|
|
|
Cash and cash equivalents |
| 5 |
|
| | |
Marketable securities |
| 6 |
|
| | |
Trade accounts receivable |
| 7 |
|
| | |
Inventories |
| 8 |
|
| | |
Recoverable taxes |
| 9 |
|
| | |
Derivative financial instruments |
| 4.5 |
|
| | |
Advances to suppliers |
| 10 |
|
| | |
Dividends receivable | 11 | | ||||
Other assets |
|
|
| | ||
Total current assets |
|
|
|
| | |
NON-CURRENT |
|
|
|
| ||
Marketable securities | 6 | | ||||
Recoverable taxes |
| 9 |
|
| | |
Deferred taxes |
| 12 |
|
| | |
Derivative financial instruments |
| 4.5 |
|
| | |
Advances to suppliers |
| 10 |
|
| | |
Judicial deposits |
|
|
| | ||
Other assets |
|
|
|
| | |
Biological assets |
| 13 |
| | ||
Investments |
| 14 |
|
| | |
Property, plant and equipment |
| 15 |
|
| | |
Right of use |
| 19.1 |
|
| | |
Intangible | 16 | | ||||
Total non-current assets |
|
|
| | ||
TOTAL ASSETS |
|
| |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
1
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED BALANCE SHEET
June 30, | December 31, | |||||
| Note |
| 2023 |
| 2022 | |
LIABILITIES |
|
|
|
|
|
|
CURRENT |
|
|
|
|
|
|
Trade accounts payable |
| 17 |
| | ||
Loans, financing and debentures | 18.1 |
|
| | ||
Lease liabilities | 19.2 | | ||||
Derivative financial instruments |
| 4.5 |
|
| | |
Taxes payable |
|
|
|
| | |
Payroll and charges |
|
|
|
| | |
Liabilities for assets acquisitions and subsidiaries |
| 23 |
|
| | |
Dividends payable |
|
|
| | ||
Advances from customers |
|
|
| | ||
Other liabilities |
|
|
|
| | |
Total current liabilities |
|
|
|
| | |
NON-CURRENT |
|
|
|
| ||
Loans, financing and debentures |
| 18.1 |
|
| | |
Lease liabilities | 19.2 | | ||||
Derivative financial instruments |
| 4.5 |
|
| | |
Liabilities for assets acquisitions and subsidiaries |
| 23 |
|
| | |
Provision for judicial liabilities |
| 20.1 |
|
| | |
Employee benefit plans |
| 21.2 |
|
| | |
Deferred taxes |
| 12 |
|
| | |
Share-based compensation plans |
| 22.3 |
|
| | |
Advances from customers | | |||||
Other liabilities |
|
|
|
| | |
Total non-current liabilities |
|
|
|
| | |
TOTAL LIABILITIES | | |||||
EQUITY |
| 24 |
|
| ||
Share capital |
|
|
| | ||
Capital reserves |
|
|
| | ||
Treasury shares | ( | ( | ||||
Profit reserves | | |||||
Other reserves |
|
|
| | ||
Retained earnings | ||||||
Controlling shareholders’ | | |||||
Non-controlling interest |
| | ||||
Total equity |
|
|
|
| | |
TOTAL LIABILITIES AND EQUITY |
|
|
| |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
2
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Second quarter | Semester ended | |||||||||
April 1 to | April 1 to | June 30, | June 30, | |||||||
| Note |
| June 30, 2023 |
| June 30, 2022 |
| 2023 |
| 2022 | |
NET SALES |
| 27 |
| |
| |
| | | |
Cost of sales |
| 29 |
| ( |
| ( |
| ( | ( | |
GROSS PROFIT |
|
|
| |
| |
| | | |
OPERATING INCOME (EXPENSES) |
|
|
|
|
| |||||
Selling |
| 29 |
| ( |
| ( |
| ( | ( | |
General and administrative |
| 29 |
| ( |
| ( |
| ( | ( | |
Income (expense) from associates and joint ventures |
| 14 |
| ( |
| |
| | | |
Other, net |
| 29 |
| |
| |
| | | |
OPERATING PROFIT BEFORE NET FINANCIAL INCOME |
|
|
| |
| |
| | | |
NET FINANCIAL INCOME (EXPENSES) |
| 26 |
|
|
| |||||
Financial expenses |
|
| ( |
| ( |
| ( | ( | ||
Financial income |
|
|
| |
| |
| | | |
Derivative financial instruments | | ( | | | ||||||
Monetary and exchange variations, net | | ( | | | ||||||
NET INCOME (LOSS) BEFORE TAXES |
|
|
| |
| ( |
| | | |
Income and social contribution taxes | ||||||||||
Current |
| 12 |
| ( |
| ( |
| ( | ( | |
Deferred | 12 | ( | | ( | ( | |||||
NET INCOME FOR THE PERIOD | | | | | ||||||
Attributable to |
|
|
|
| ||||||
Controlling shareholders’ |
|
|
| |
| |
| | | |
Non-controlling interest |
|
|
| |
| |
| | | |
Earnings (loss) per share |
|
|
|
| ||||||
Basic | 25.1 | | | |||||||
Diluted | 25.2 | | |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
3
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Second quarter | Semester ended | |||||||
April 1 to | April 1 to | June 30, | June 30, | |||||
| June 30, 2023 |
| June 30, 2022 |
| 2023 |
| 2022 | |
Net income for the period |
| |
| |
| |
| |
Other comprehensive income (loss) | ||||||||
Fair value investments in equity measured at fair value through other comprehensive income |
| ( | | ( | ( | |||
Tax effect on the fair value of investments | | ( | | | ||||
Items with no subsequent effect on income | ( | | ( | ( | ||||
Exchange rate variations on conversion of financial information of subsidiaries abroad | | | ( | ( | ||||
Realization of exchange variation on investments abroad | ( | ( | ||||||
Items with subsequent effect on income | | | ( | ( | ||||
| | | | |||||
Attributable to | ||||||||
Controlling shareholders’ | | | | | ||||
Non-controlling interest | | | | |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
4
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to controlling shareholders’ | ||||||||||||||||||||||||||||||
Share capital | Capital reserves | Profit reserves | ||||||||||||||||||||||||||||
|
| Share |
| Stock |
|
|
| Reserve |
| Special |
|
|
| Retained |
| Non- |
| |||||||||||||
Share | issuance | options | Treasury | Tax | Legal | for capital | statutory | Investment | Dividends | Other | earnings | controlling | ||||||||||||||||||
| Capital |
| costs |
| granted |
| shares |
| incentives |
| Reserve |
| increase |
| reserve |
| reserve | proposed |
| reserves |
| (losses) |
| Total |
| interest |
| Total equity | ||
Balances at December 31, 2021 | | ( | | ( | | | | | | | | | | |||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||
Net income for the period | | | | | ||||||||||||||||||||||||||
Other comprehensive income for the period | ( | ( | ( | |||||||||||||||||||||||||||
Transactions with shareholders | ||||||||||||||||||||||||||||||
Stock options granted (Note 22.3) | | | | |||||||||||||||||||||||||||
Shares granted (Note 22.3) | ( | | ||||||||||||||||||||||||||||
Share repurchase (note 24.2) | ( | ( | ( | |||||||||||||||||||||||||||
Unclaimed dividends forfeited | | | | |||||||||||||||||||||||||||
Fair value attributable to non-controlling interest | ( | ( | ||||||||||||||||||||||||||||
Proposed additional dividend payment (note 1.2.2) | ( | ( | ( | ( | ||||||||||||||||||||||||||
Payment of supplementary dividends (note 1.2.3) | ( | ( | ( | ( | ||||||||||||||||||||||||||
Internal changes in equity | ||||||||||||||||||||||||||||||
Proposed minimum mandatory dividends | ( | | ||||||||||||||||||||||||||||
Realization of deemed cost, net of taxes | ( | | ||||||||||||||||||||||||||||
Balances at June 30, 2022 | | ( | | ( | | | | | | | | | | |||||||||||||||||
Balances at December 31, 2022 | | ( | | ( | | | | | | | | | ||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||
Net income for the period | ||||||||||||||||||||||||||||||
Other comprehensive income for the period | ( | ( | ( | |||||||||||||||||||||||||||
Transactions with shareholders | ||||||||||||||||||||||||||||||
Shares granted (Note 22.3) | ||||||||||||||||||||||||||||||
Shares repurchased (Note 24.2) | ( | ( | ( | |||||||||||||||||||||||||||
Treasury shares cancelled (Note 1.2.5) | | ( | ||||||||||||||||||||||||||||
Fair value attributable to non-controlling interest | ( | ( | ||||||||||||||||||||||||||||
Internal changes in equity | ||||||||||||||||||||||||||||||
Constitution of reserves (Note 25.3) | ( | | ||||||||||||||||||||||||||||
Realization of deemed cost, net of taxes | ( | |||||||||||||||||||||||||||||
Balances at June 30, 2023 | ( | ( | | |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
5
Suzano S.A. Unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 (In thousands of R$, unless otherwise stated) |
CONSOLIDATED STATEMENTS OF CASH FLOW
June 30, | June 30, | |||
| 2023 |
| 2022 | |
OPERATING ACTIVITIES | ||||
Net income (loss) for the period | |
| | |
Adjustment to | ||||
Depreciation, depletion and amortization | |
| | |
Depreciation of right of use (Note 19.1) |
| |
| |
Sublease of ships | ( | |||
Interest expense on lease liabilities | |
| | |
Result from sale and disposal of property, plant and equipment and biological assets, net (Note 29) |
| |
| ( |
Income (expense) from associates and joint ventures |
| ( |
| ( |
Exchange rate and monetary variations, net (Note 26) |
| ( |
| ( |
Interest expenses on financing, loans and debentures, net (Note 26) |
| |
| |
Capitalized loan costs (Note 26) | ( | ( | ||
Accrual of interest on marketable securities | ( | ( | ||
Amortization of transaction costs (Note 26) |
| |
| |
Derivative gains, net (Note 26) |
| ( |
| ( |
Fair value adjustment of biological assets (Note 13) |
| ( |
| ( |
Deferred income tax and social contribution (Note 12.3) | | | ||
Interest on actuarial liabilities (Note 21.2) |
| |
| |
Provision for judicial liabilities, net (Note 20.1) | |
| | |
Tax litigation reduction program | |
| ||
Provision for doubtful accounts, net (Note 7.3) | |
| | |
Provision for inventory losses, net (Note 8.1) | ( | ( | ||
Provision for loss of ICMS credits, net (Note 9.1) | | | ||
Other | | | ||
Decrease (increase) in assets |
| |||
Trade accounts receivable | |
| | |
Inventories | ( |
| ( | |
Recoverable taxes | ( |
| ( | |
Other assets | |
| | |
Increase (decrease) in liabilities |
| |||
Trade accounts payable | ( |
| | |
Taxes payable | | | ||
Payroll and charges | ( |
| ( | |
Other liabilities | ( |
| ( | |
Cash generated from operations | |
| | |
Payment of interest on financing, loans and debentures (Note 18.3) | ( | ( | ||
Capitalized loan costs paid | | | ||
Interest received on marketable securities | | | ||
Payment of income taxes | ( | ( | ||
Cash provided by operating activities | |
| | |
INVESTING ACTIVITIES | ||||
Additions to property, plant and equipment (Note 15) |
| ( |
| ( |
Additions to intangible (Note 16) | ( |
| ( | |
Additions to biological assets (Note 13) |
| ( |
| ( |
Proceeds from sales of property, plant and equipment | |
| | |
Capital increase in subsidiaries and affiliates | ( | ( | ||
Marketable securities, net | ( | ( | ||
Advances for acquisition (receipt) of wood from operations with development and partnerships | ( | ( | ||
Dividends received | | | ||
Asset acquisition (Note 23) | ( | ( | ||
Acquisition of subsidiaries (Note 1.2.3) | ( | |||
Net cash from acquisition of subsidiaries | | |||
Cash used in investing activities | ( |
| ( | |
FINANCING ACTIVITIES |
| |||
Proceeds from loans, financing and debentures (Note 18.3) |
| |
| |
Receipt of derivative transactions (Note 4.5.4) | | | ||
Payment of loans, financing and debentures (Note 18.3) |
| ( |
| ( |
Payment of leases (Note 19.2) | ( |
| ( | |
Payment of dividends |
| ( |
| ( |
Liabilities for assets acquisitions and subsidiaries | ( | ( | ||
Shares repurchased (Note 24.2) | ( | ( | ||
Cash provided (used) by financing activities | |
| ( | |
EXCHANGE VARIATION ON CASH AND CASH EQUIVALENTS | ( |
| ( | |
Increase (decrease) in cash and cash equivalents, net | |
| ( | |
At the beginning of the period |
| |
| |
At the end of the period |
| |
| |
Increase (decrease) in cash and cash equivalents, net | |
| ( |
The accompanying notes are an integral part of this unaudited condensed consolidated interim financial information.
6
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
Suzano S.A. (“Suzano”) and its subsidiaries (collectively the “Company”) is a public company with its headquarters in Brazil, at Avenida Professor Magalhães Neto, No. 1,752 - 10th floor, rooms 1010 and 1011, Bairro Pituba, in the city of Salvador, State of Bahia, and its main business office in the city of São Paulo.
Suzano’s shares are traded on B3 S.A. (“Brasil, Bolsa, Balcão - “B3”), listed in the New Market under the ticker SUZB3, and its American Depositary Receipts (“ADRs”) in a ratio of 1 (one) per common share, Level II, are traded in the New York Stock Exchange (“NYSE”) under the ticker SUZ.
The Company has
These units produce hardwood pulp from eucalyptus, coated paper, paperboard, uncoated paper and cut size paper and packages of sanitary paper (consumer goods - tissue) to serve the domestic and foreign markets.
Pulp and paper are sold in foreign markets by Suzano, as well as through its wholly-owned subsidiaries and/or its sales offices in Argentina, Austria, China, Ecuador, United States of America, and Singapore.
The Company’s operations also include the commercial management of eucalyptus forest for its own use, the operation of port terminals, and the holding of interests, as a partner or shareholder, in other companies or enterprises, and the generation of electricity in the pulp production process and its commercialization.
The Company is controlled by Suzano Holding S.A., through a voting agreement whereby it holds
These unaudited condensed consolidated interim financial information was authorized by the Board of Directors on August 1, 2023.
7
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
1.1. | Equity interests |
The Company holds equity interests in the following entities:
% equity interest |
| ||||||||
| June 30, |
| December 31, |
| |||||
Entity/Type of investment |
| Main activity |
| Country |
| 2023 |
| 2022 |
|
Consolidated | |||||||||
F&E Tecnologia do Brasil S.A. (Direct) |
|
|
| | % | | % | ||
Fibria Celulose (USA) Inc. (Direct) |
|
|
| | % | | % | ||
Fibria Overseas Finance Ltd. (Direct) |
|
|
| | % | | % | ||
Fibria Terminal de Celulose de Santos SPE S.A. (Direct) |
|
|
| | % | | % | ||
FuturaGene Ltd. |
|
|
| | % | | % | ||
FuturaGene Delaware Inc. (Indirect) |
|
|
| | % | | % | ||
FuturaGene Israel Ltd. (Indirect) |
|
|
| | % | | % | ||
FuturaGene Inc. (Indirect) | | % | | % | |||||
Maxcel Empreendimentos e Participações S.A. (Direct) |
|
|
| | % | | % | ||
Itacel - Terminal de Celulose de Itaqui S.A. (Indirect) |
|
|
| | % | | % | ||
MMC Brasil Indústria e Comércio Ltda (Direct)(1) |
|
|
| | % | ||||
Mucuri Energética S.A. (Direct) |
|
|
| | % | | % | ||
Paineiras Logística e Transportes Ltda. (Direct) |
|
|
| | % | | % | ||
Portocel - Terminal Espec. Barra do Riacho S.A. (Direct) |
|
|
| | % | | % | ||
Projetos Especiais e Investimentos Ltda. (Direct) |
|
|
| | % | | % | ||
SFBC Participações Ltda. (Direct) |
|
|
| | % | | % | ||
Stenfar S.A. Indl. Coml. Imp. Y. Exp. (Direct) |
|
| | % | | % | |||
Suzano Austria GmbH. (Direct) |
|
| | % | | % | |||
Suzano Canada Inc. (Direct) |
|
|
| | % | | % | ||
Suzano Ecuador S.A.S. (Direct) (2) |
|
|
| | % | ||||
Suzano Finland Oy (Direct) |
|
|
| | % | | % | ||
Suzano International Finance B.V (Direct) | | % | | % | |||||
Suzano International Trade GmbH. (Direct) | | % | | % | |||||
Suzano Material Technology Development Ltd. (Direct) | | % | | % | |||||
Suzano Operações Industriais e Florestais S.A. (Direct) |
|
|
| | % | | % | ||
Suzano Pulp and Paper America Inc. (Direct) |
|
|
| | % | | % | ||
Suzano Pulp and Paper Europe S.A. (Direct) |
|
|
| | % | | % | ||
Suzano Shanghai Ltd. (Direct) | | % | | % | |||||
Suzano Shanghai Trading Ltd. (Direct) (3) |
|
|
| | % | ||||
Suzano Singapura Pte. Ltd (Direct) (4) |
|
|
| | % | ||||
Suzano Trading International KFT(Direct) |
|
|
| | % | | % | ||
Suzano Ventures LLC (Direct) | | % | | % |
8
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
% equity interest |
| ||||||||
June 30, |
| December 31, |
| ||||||
Entity |
| Main activity |
| Country |
| 2023 |
| 2022 |
|
Joint operation | |||||||||
Veracel Celulose S.A. (Direct) |
|
| | % | | % | |||
Equity | |||||||||
Biomas Serviços Ambientais, Restauração e Carbono S.A. (Direct) (5) | | % | | % | |||||
Ensyn Corporation (Direct) (6) | | % | | % | |||||
F&E Technologies LLC (Direct/Indirect) | | % | | % | |||||
Ibema Companhia Brasileira de Papel (Direct) | | % | | % | |||||
Spinnova Plc (Direct) | | % | | % | |||||
Woodspin Oy (Direct/Indirect) |
|
| | % | | % | |||
Fair value through other comprehensive income | |||||||||
Celluforce Inc. (Direct) | | % | | % |
1) | On June 1, 2023, the Company completed the acquisition of MMC Brasil Indústria e Comércio Ltda.(Note 1.2.3.) |
2) | On March 8, 2023, establishment of legal entity with full equity interest from Suzano S.A. |
3) | On May 19, 2023, establishment of legal entity with full equity interest from Suzano S.A. |
4) | On May 23, 2023, establishment of legal entity with full equity interest from Suzano S.A. |
5) | On February 27 and March 21, 2023, equivalent contributions were made by the six shareholders of Biomas to constitute an equity interest (Note 1.2.6). |
6) | On May 17, 2023, the percentage of interest was changed due to the dilution of the shares. |
9
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
1.2.Major events in the six-month period ended June 30, 2023
1.2.1.Effects of the war between Russia and Ukraine
The Company has continuously monitored the impacts of the current conflict between Russia and Ukraine, both direct and indirect, on society, the economy and markets (global and domestic), with the objective of evaluating possible impacts and risks for the business.
The Company’s assessment has covered four main areas:
(i) | Personnel: Suzano does not have employees or facilities of any nature in any of the locations directly impacted by the conflict. |
(ii) | Supply Chain: the Company did not identify any short-term or long-term risk of possible interruptions or shortages of materials for its industrial and forestry activities. So far, the only effects observed have been greater volatility in commodities and energy prices. |
(iii) | Logistics: internationally, there was no change in the Company’s logistical operations, with all the routes used remaining unchanged and the moorings in the planned locations being maintained. At the domestic level, no changes in logistical flows were identified. |
(iv) | Commercial: to date, the Company has continued with its transactions as planned, maintaining service to its customers in all its sectors of activity. Sales to a few customers located in Russia were suspended, without any significant financial impact. |
As a result of the current scenario, the Company has taken steps to expand its monitoring of the situation, together with its main stakeholders, in order to ensure any updates and information flows required for its global decision-making are available in a timely manner.
1.2.2.Cerrado Project
On October 28, 2021, the Company’s Board of Directors approved the realization of the Cerrado Project, which consists of building a pulp production mill in the municipality of Ribas do Rio Pardo, in the state of Mato Grosso do Sul.
The plant will have an estimated nominal capacity of
1.2.3.Acquisition of tissue business in Brazil
On June 1 2023, the Company acquired the totality of the quotas held by Kimberly-Clark Brasil Indústria e Comércio de Produtos de Higiene Ltda. (“KC Brasil”) in MMC Brasil Indústria e Comércio Ltda (“MMC Brasil”) for the consideration of US$
MMC Brasil had no operations until the contribution made by KC Brasil as a result of the carve out carried out in May 25, 2023 of the assets related to the business of manufacturing, marketing, distributing and selling of tissue products, including toilet paper, paper towels, napkins, tissues, as well as other paper products in Brazil, including ownership of the brand “NEVE” of KC Brasil.
10
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The following table summarizes the allocation of the preliminary purchase price:
Total purchase consideration (full payment on closing) |
| |
Book value of Shareholders’ Equity of MMC Brasil |
| |
Fair value adjustment |
|
|
Inventories (1) |
| |
Property, plant and equipment (2) |
| |
Trademark and patents (3) |
| |
Net identifiable assets acquired |
| |
Goodwill (4) |
| |
(1) | Measured considering the balance of finished products based on selling price, net of selling expenses. |
(2) | Measured based on the analysis of market data on comparable transactions and cost quantification, based on the estimate of replacement or replacement value of the assets. |
(3) | Measured based on revenue projections for products under the evaluated brands, according to the Refief from Royalties methodology. |
Considering the fact that MMC Brasil was created based on a carve out of a portion of the KC Brasil businesses, counterparty of the transaction, there is no previous history of revenue and/or profits specifically for the acquired entity to be considered or included in a pro forma consolidated revenue and pro forma consolidated profit as if the acquisition had occurred on January 1, 2023.
Acquisition related costs of R$
1.2.4.Federal Supreme Court (“STF”) decision – Effectiveness of final and unappealable tax decisions
On February 8, 2023, the Federal Supreme Court in Brazil concluded the judgments of Items 881 and 885, which discussed the effects of res judicata. Notwithstanding, considering the information available as of the date of these unaudited condensed consolidated interim financial information, the Company is not a party to any litigation related to a tax not being collected due to a past decision considered unappealable, therefore, the Company has no material adjustment due to the decision.
1.2.5.Treasury shares cancelled
On February 28, 2023, the Board of Directors decided to cancel
1.2.6.Biomas
On September 5, 2022, Biomas Serviços Ambientais, Restauração e Carbono Ltda. (“Biomas”) was initially established by Suzano S.A.
On November 12, 2022, Suzano in partnership with Itaú Unibanco S.A, Marfrig Global Foods S.A., Rabobank Foundational Investments B.B., Santander Corretora de Seguros, Investimentos e Serviços S.A. and Vale S.A., announced an alliance during an event held at the Climate Conference, COP27, in Egypt, for the creation of a company focused entirely to forest restoration, conservation and preservation activities in Brazil.
After the transformation of Biomas into a joint venture, Suzano, together with Marfrig, Rabobank and Vale, made a commitment to invest R$
11
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
For the period ended June 30, 2023, the amount of R$
With the completion of the above investments, each company now holds
2. | BASIS OF PREPARATION AND PRESENTATION OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION |
The Company’s unaudited condensed consolidated interim financial information, of the six-month period ended June 30, 2023, are prepared in compliance with the international standard IAS 34 Interim Financial Reporting issued by the International Accounting Standards Board (“IASB”) and disclose all the applicable significant information related to the financial information, which is consistent with the information used by Management in the performance of its duties.
The Company’s unaudited condensed consolidated interim financial information are expressed in thousands of Brazilian Reais (“R$”), as well as the amounts of other currencies, when applicable, were also expressed in thousands, unless otherwise stated.
The preparation of unaudited condensed consolidated interim financial information requires Management to make judgments, use estimates and adopt policies in the process of applying accounting practices that affect the disclosed amounts of revenues, expenses, assets and liabilities, including the disclosure of contingent liabilities assumed. However, the uncertainty inherent to these judgements, assumptions and estimates could result in material adjustments to the carrying amount of certain assets and liabilities in future periods.
The Company reviews its judgments, estimates and assumptions continually as disclosed in the annual financial statements for the year ended December 31, 2022 (Note 3.2.34). There were no changes in these judgments, estimates and assumptions compared to disclosed on December 31, 2022.
The unaudited condensed consolidated interim financial information prepared on historical cost basis, except for the following material items recognized:
(i) | Derivative and non-derivative financial instruments measured at fair value; |
(ii) | Share-based payments and employee benefits measured at fair value; and |
(iii) | Biological assets measured at fair value; |
The unaudited condensed consolidated interim financial information was prepared under the going concern assumption.
12
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
3.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The unaudited condensed consolidated interim financial information was prepared based on the information of Suzano and its subsidiaries on the same base date, except for subsidiary MMC Brasil and associates Ensyn and Spinnova, as well as in accordance with consistent accounting policies and practices.
The unaudited condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended December 31, 2022, considering that its purpose is to provide an update on the activities, events and significant circumstances in relation to those disclosed in the consolidated financial statements. Therefore, unaudited condensed consolidated interim financial information focus on new activities, events and circumstances and do not duplicate the information previously disclosed, except when Management judges that the maintenance of the information is relevant.
The accounting policies have been consistently applied to all consolidated companies.
There were no changes on such policies and estimates calculation methodologies, except for the application of the new accounting policies as of January 1, 2023 and whose estimated impact was disclosed in the annual financial statements of December 31, 2022, as disclosed in the Note 3.1.
3.1.New accounting policies and changes in accounting policies adopted
The new standards and interpretations issued, until the issuance of the Company’s unaudited condensed consolidated interim financial information, are described below.
3.1.1.Accounting policies adopted
3.1.1.1. | Presentation of the financial statements – IAS 1 – Classification of liabilities as current and non-current (applicable for annual periods beginning on/or after January 1, 2023, with early adoption permitted) |
The amendments to IAS 1 affect only the presentation of liabilities as current or non-current in the balance sheet, and not the amount or the timing of the recognition of any asset, liability, income or expense, or the information disclosed about these items.
The amendments clarify that the classification of liabilities as current or non-current is based on the rights existing at the balance sheet date, specify that the classification is not affected by expectations about whether an entity will exercise its right to postpone the settlement of the liability, explain that the rights exist if restrictive clauses are complied with at the balance sheet date, and introduce the definition of ‘settlement’ to clarify that it refers to a transfer to a counterparty of an amount in cash, equity instruments, other assets or services.
The Company assessed the content of this pronouncement and did not identify any impacts.
3.1.1.2. | Amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements – Disclosure of Accounting Policies (applicable for annual periods beginning on/or after January 1, 2023, with early adoption permitted) |
The amendments change the requirements in IAS 1 with regard to the disclosure of accounting policies. The amendments replace all instances of the term ‘significant accounting policies’ with ‘material accounting policy information’. Accounting policy information is material if, considered together with other information included in an entity’s financial statements, it can reasonably be expected to influence the decisions that the primary users of the financial statements make on the basis of those financial statements.
The supporting paragraphs in IAS 1 are also amended to clarify that accounting policy information that relates to immaterial transactions, other events or conditions is immaterial, and need not be disclosed. Accounting policy information may be material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial. However, not all accounting policy information relating to material transactions, other events or conditions is itself material.
The Company assessed the content of this pronouncement and did not identify any impacts.
13
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
3.1.1.3. | Amendments to IAS 8 Definition of Accounting Estimates (applicable for annual periods beginning on/or after January 1, 2023) |
The amendments replace the definition of a change in accounting estimates with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. The definition of a change in accounting estimates was deleted. However, the Board retained the concept of changes in accounting estimates in the Standard through the following clarifications:
(i) | A change in accounting estimates that results from new information or new developments does not constitute the correction of an error |
(ii) | The effects of a change in an input or a measurement technique used to develop an accounting estimate represent changes in accounting estimates if they do not result from the correction of prior period errors |
The Company assessed the content of this pronouncement and did not identify any impacts.
3.1.1.4. | Amendments to IAS 12 – Deferred tax related to assets and liabilities arising from a single transaction (applicable for annual periods beginning on/or after January 1, 2023) |
The amendments introduce a further exception to the initial recognition exemption. Under the amendments, an entity may not apply the initial recognition exemption for transactions that give rise to equal taxable and deductible temporary differences.
Depending on the applicable tax law, equal taxable and deductible temporary differences may arise from the initial recognition of an asset and liability in a transaction that is not a business combination and affects neither the accounting nor the taxable profit. For example, this may arise upon the recognition of a lease liability and the corresponding right-of-use asset, applying IFRS 16 at the commencement date of a lease.
Following the amendments to IAS 12, an entity is required to recognise the related deferred tax asset and liability, with the recognition of any deferred tax asset being subject to the recoverability criteria in IAS 12.
The amendments apply to transactions that occur on or after the beginning of the earliest comparative period presented. In addition, at the beginning of the earliest comparative period, an entity recognises:
(i) | A deferred tax asset (to the extent that it is probable that taxable profits will be available against which the deductible temporary difference can be utilized) and a deferred tax liability for all deductible and taxable temporary differences associated with: |
● | Right-of-use assets and lease liabilities; and |
● | Decommissioning, restoration and similar liabilities and the corresponding amounts recognised as part of the cost of the related asset. |
(ii) | The cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings (or another component of equity, as appropriate) at that date. |
The Company assessed the content of this pronouncement and did not identify any impacts.
14
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
4.FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT
4.1.Financial risks management
4.1.1.Overview
In the six-month period ended June 30, 2023, there were no significant changes in the financial risk management policies and procedures compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4).
The Company maintained its conservative approach and strong cash and marketable securities position, as well as its hedging policy.
4.1.2.Classification
All transactions with financial instruments are recognized for accounting purposes and classified in the following categories:
|
| June 30, |
| December 31, | ||
| Note |
| 2023 |
| 2022 | |
Assets |
|
|
|
|
|
|
Amortized cost |
|
|
|
|
|
|
Cash and cash equivalents |
| 5 |
|
| | |
Trade accounts receivable |
| 7 |
|
| | |
Dividends receivable | 11 | | ||||
Other assets (1) |
|
|
| | ||
|
|
| | |||
Fair value through other comprehensive income |
|
|
| |||
Investments - Celluforce |
| 14.1 |
|
| | |
|
| | ||||
Fair value through profit or loss |
|
|
|
| ||
Derivative financial instruments |
| 4.5.1 |
|
| | |
Marketable securities |
| 6 |
|
| | |
|
|
| | |||
|
|
| | |||
Liabilities |
|
|
|
| ||
Amortized cost |
|
|
|
| ||
Trade accounts payable | 17 | | ||||
Loans, financing and debentures |
| 18.1 |
|
| | |
Lease liabilities |
| 19.2 |
|
| | |
Liabilities for assets acquisitions and subsidiaries |
| 23 |
|
| | |
Dividends payable |
| 11 |
|
| | |
Other liabilities (1) |
|
|
| | ||
|
|
| | |||
Fair value through profit or loss |
|
|
|
| ||
Derivative financial instruments |
| 4.5.1 |
|
| | |
| ||||||
|
|
| | |||
|
|
| |
1)Does not include items not classified as financial instruments.
15
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
4.1.3.Fair value of loans and financing
The estimated fair values of loans and financing are set forth below:
| Yield used |
|
| |||
to discount/ | June 30, | December 31, | ||||
| methodology |
| 2023 |
| 2022 | |
Quoted in the secondary market |
|
|
|
|
|
|
In foreign currency |
|
|
|
|
|
|
Bonds |
|
|
| | ||
Estimated present value |
|
|
|
| ||
In foreign currency |
|
|
|
| ||
Export credits (“Prepayment”) |
|
|
| | ||
Assets Financing | | |||||
IFC - International Finance Corporation | ||||||
In local currency |
|
|
|
| ||
BNDES – TJLP |
|
|
| | ||
BNDES – TLP |
|
|
| | ||
BNDES – Fixed |
|
|
| | ||
BNDES – SELIC (“Special Settlement and Custody System”) |
|
|
| | ||
BNDES - Currency basket |
|
|
| | ||
CRA (“Agribusiness Receivables Certificate”) |
|
|
| | ||
Debentures |
|
|
| | ||
NCE (“Export Credit Notes”) |
|
|
| | ||
NCR (“Rural Credit Notes”) |
|
|
| | ||
Export credits (“Prepayment”) |
|
|
| | ||
|
| |
The book values of loans and financing are disclosed in Note 18.
Management considers that, for its other financial liabilities measured at amortized cost, their book values approximate their fair values, and therefore the fair value information is not being presented.
4.2.Liquidity risk management
The Company’s purpose is to maintain a strong cash and marketable securities position to meet its financial and operating commitments. The amount held in cash is intended to cover the expected outflows in the normal course of its operations, while the cash surplus is generally invested in highly liquid financial investments according to the Cash Management Policy.
The cash position is monitored by the Company’s Management, by means of management reports and participation in performance meetings with determined frequencies. During the six-month period ended June 30, 2023, the variations in cash and marketable securities were as expected, and the cash generated from operations was mostly used for investments and debt service.
All derivative financial instruments were traded over the counter and do not require deposit guarantee margins.
The remaining contractual maturities of financial liabilities are presented as of the balance sheet date. The amounts as set forth below consist of undiscounted cash flow, and include interest payments and exchange rate variations, and therefore may not reconcile with the amounts disclosed in the balance sheet.
16
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
June 30, | ||||||||||||
2023 | ||||||||||||
Book | Future | Up to 1 | 1 - 2 | More than | ||||||||
| value |
| value |
| year |
| years |
| 2 - 5 years |
| 5 years | |
Liabilities |
|
|
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|
|
|
|
|
|
|
|
|
Trade accounts payable |
| |||||||||||
Loans, financing and debentures |
| |||||||||||
Lease liabilities | ||||||||||||
Liabilities for asset acquisitions and subsidiaries |
| |||||||||||
Derivative financial instruments |
| |||||||||||
Dividends payable | ||||||||||||
Other liabilities |
| |||||||||||
|
December 31, | ||||||||||||
2022 | ||||||||||||
Book | Future | Up to 1 | 1 - 2 | More than | ||||||||
| value |
| value |
| year |
| years |
| 2 - 5 years |
| 5 years | |
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts payable |
| | | | ||||||||
Loans, financing and debentures |
| | | | | | | |||||
Lease liabilities | | | | | | | ||||||
Liabilities for asset acquisitions and subsidiaries |
| | | | | | | |||||
Derivative financial instruments |
| | | | | | | |||||
Dividends payable | | | | |||||||||
Other liabilities |
| | | | | |||||||
| | | | | | |
4.3. Credit risk management
In the six-month period ended June 30, 2023, there were no significant changes in the credit risk management policies compared to those disclosed in the annual financial statements for the year ended of December 31, 2022 (Note 4).
4.4.Market risk management
In the six-month period ended June 30, 2023, there were no significant changes in the market risk management policies and procedures compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4).
4.4.1.Exchange rate risk management
As disclosed in the financial statements for the year ended December 31, 2022 (Note 4), the Company enters into U.S.Dollar selling transactions in the futures markets, including strategies involving options, to ensure attractive levels of operating margins for a portion of revenue. Such transactions are limited to a percentage of the net surplus foreign currency over a ’ time horizon and therefore, are matched to the availability of currency for sale in the short term. The Company’s Board of Directors approved the contracting of extraordinary hedge, in addition to the strategy mentioned above, for investments in the Cerrado Project, with a term of up to
17
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The assets and liabilities that are exposed to foreign currency, substantially in U.S. Dollars, are set forth below:
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Assets |
|
|
|
|
Cash and cash equivalents |
|
| | |
Marketable securities | | |||
Trade accounts receivable |
|
| | |
Derivative financial instruments |
|
| | |
|
| | ||
Liabilities |
|
| ||
Trade accounts payable |
| ( |
| ( |
Loans and financing |
| ( |
| ( |
Liabilities for asset acquisitions and subsidiaries |
| ( |
| ( |
Derivative financial instruments | ( | ( | ||
( | ( | |||
| ( |
| ( |
4.4.1.1.Sensitivity analysis – foreign exchange rate exposure – except for derivative financial instruments
For market risk analysis, the Company uses scenarios to evaluate both its asset and liability positions in foreign currency, and the possible effects on its results. The probable scenario represents the amounts recognized, as they reflect the conversion into Brazilian Reais on the balance sheet date (R$ to U.S.$ = R$
This analysis assumes that all other variables, particularly interest rates, remain constant. The other scenarios considered the depreciation of the Brazilian Real against the U.S. Dollar at the rates of 25% and 50% before taxes.
The following table set forth the potential impacts at their absolute amounts:
June 30, | ||||||
2023 | ||||||
| Effect on profit or loss | |||||
Probable | Possible | Remote | ||||
| (base value) |
| (25%) |
| (50%) | |
Cash and cash equivalents |
|
|
| |||
Marketable securities | ||||||
Trade accounts receivable |
|
|
| |||
Trade accounts payable |
| ( |
| ( |
| ( |
Loans and financing |
| ( |
| ( |
| ( |
Liabilities for asset acquisitions and subsidiaries |
| ( |
| ( |
| ( |
4.4.1.2.Sensitivity analysis – foreign exchange rate exposure – derivative financial instruments
The Company has sales operations in US$ in the futures markets, including strategies using options, to ensure attractive levels of operating margins for a portion of its revenue. These operations are limited to a percentage of the total exposure to US$ over a 24-month horizon, or to investments in the Cerrado Project, according to the extraordinary hedge described above, and are therefore pegged to the availability of ready-to-sell foreign exchange in the short term.
In addition to the transaction described above, the Company also taken out derivative instruments linked to the US$ and subject to exchange fluctuations, seeking to adjust the debt’s currency indexation to the cash generation currency, as provided for in its financial policies.
For the calculation of the mark-to-market (“MtM”) price, the exchange rate of the last business day of the period is used. These market movements caused a positive impact on the mark-to-market position entered into by the Company.
This analysis below assumes that all other variables, particularly the interest rates, remain constant. The other scenarios considered the depreciation of the Brazilian Real against the US$ by 25% and 50%, before taxes, based on the base scenario on June 30, 2023.
18
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The following table set out the possible impacts assuming these scenarios:
June 30, | ||||||
2023 | ||||||
Effect on profit or loss | ||||||
| Probable |
| Possible |
| Remote | |
| (base value) |
| 25% |
| 50% | |
Dollar/Real | ||||||
Derivative financial instruments | ||||||
Derivative options | ( | ( | ||||
Derivative swaps |
| ( |
| ( |
| ( |
Derivative Non-Deliverable Forward (‘NDF’) Contracts |
| ( |
| ( | ||
Embedded derivatives | ( | ( | ||||
NDF parity derivatives (1) | ( | ( | ||||
Commodity Derivatives | ( | ( | ||||
Dollar/Euro | ||||||
Derivative financial instruments | ||||||
NDF parity derivatives (1) |
| ( |
| ( |
(1)Long positions at US$/EUR parity in order to protect the Capex cash flow of the Cerrado Project against the appreciation of the Euro.
4.4.2.Interest rate risk management
Fluctuations in interest rates could increase or reduce the costs of new loans and existing contracted operations.
The Company is constantly looking for alternatives for the use of financial instruments in order to avoid negative impacts on its cash flow.
Considering that on March 5, 2021, the Financial Conduct Authority (“FCA”) announced the discontinuation date of the 3-month LIBOR as June 30, 2023, the Company initiated negotiations of the terms for swapping the indexers of its debt contracts and related derivatives upon this announcement.
As of June 30, 2023, the Company had R$
The Company understands that it will not be necessary to change the risk management strategy due to the change of indexation of its financial contracts linked to LIBOR.
4.4.2.1.Sensitivity analysis – exposure to interest rates – except for derivative financial instruments
For its market risk analysis, the Company uses scenarios to evaluate the sensitivity of changes in operations impacted by the following rates: Interbank Deposit Rate (“CDI”), Long Term Interest Rate (“TJLP”), Special System for Settlement and Custody (“SELIC”) and the London Interbank Offered Rate (“LIBOR”), which could impact the results. The probable scenario represents the amounts already booked, as they reflect Management’s best estimates.
This analysis assumes that all other variables, particularly exchange rates, will remain constant. The other scenarios considered a depreciation of 25% and 50% in market interest rates.
19
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The following table set forth the possible impacts assuming these scenarios in absolute amounts:
June 30, | ||||||
2023 | ||||||
Effect on profit or loss | ||||||
Possible | Remote | |||||
| Probable |
| (25%) |
| (50%) | |
CDI/SELIC |
|
|
|
|
|
|
Cash and cash equivalents |
|
|
| |||
Marketable securities | ||||||
Loans and financing |
|
|
| |||
TJLP |
|
|
| |||
Loans and financing |
|
|
| |||
LIBOR |
|
|
| |||
Loans and financing |
|
|
| |||
SOFR | ||||||
Loans and financing |
4.4.2.2.Sensitivity analysis – exposure to interest rates – derivative financial instruments
This analysis assumes that all other variables remain constant. The other scenarios considered a depreciation of 25% and 50% in market interest rates.
The following table sets out the possible impacts of these assumed scenarios:
June 30, | ||||||
2023 | ||||||
Effect on profit or loss | ||||||
|
| Probable |
| Remote | ||
| Probable |
| 25% |
| 50% | |
CDI |
|
|
| |||
Derivative financial instruments |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Derivative options | ( | ( | ||||
Derivative swaps |
| ( |
| ( |
| ( |
LIBOR |
|
|
|
|
|
|
Derivative financial instruments |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Derivative swaps |
| ( |
|
|
4.4.2.3.Sensitivity analysis to changes in the consumer price indices of the US economy
For the measurement of the probable scenario, the United States Consumer Price Index (“US-CPI”) was considered on June 30, 2023. The probable scenario was extrapolated considering a depreciation of 25% and 50% in the US-CPI to define the possible and remote scenarios, respectively.
The following table sets out the possible impacts, assuming these scenarios in absolute amounts:
June 30, | ||||||
2023 | ||||||
Effect on profit or loss | ||||||
| Probable | Possible | Remote | |||
| (base value) |
| (25%) |
| (50%) | |
Embedded derivative in a commitment to purchase standing wood, originating from a forest partnership agreement | ( | ( |
20
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
4.4.3.Commodity price risk management
The Company is exposed to commodity prices, mainly in the selling price of pulp in the international market. The dynamics of rising and falling production capacities in the global market and macroeconomic conditions may impact the Company´s operating results.
Through a specialized team, the Company monitors hardwood pulp prices and analyses future trends, adjusting the forecasts aimed at assisting with preventive measures to calculate the different scenarios. There is no sufficiently liquid financial market to mitigate the risk of a material portion of the Company’s operations. Hardwood pulp price protection instruments available on the market have low liquidity and low volume, and high levels of distortion in price formation.
The Company is also exposed to international oil prices, reflected in logistical costs for selling in the export market, and indirectly in the costs of other supply, logistics and service contracts. In such cases, the Company evaluates whether to contract derivative financial instruments to mitigate the risk of price variations in its results.
4.5.Derivative financial instruments
The Company determines the fair value of derivative contracts, which differ from the amounts realized in the event of early settlement due to bank spreads and market factors at the time of quotation. The amounts presented by the Company are based on an estimate using market factors and use data provided by third parties, measured internally and compared to calculations performed by external consultants and by counterparties.
Details of derivative financial instruments and their respective calculation methodologies are disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4).
4.5.1.Outstanding derivatives by type of contract, including embedded derivatives
The positions of outstanding derivatives are set forth below:
Notional value, net in U.S.$ | Fair value | |||||||
June 30, | December 31, | June 30, | December 31, | |||||
| 2023 |
| 2022 |
| 2023 |
| 2022 | |
Instruments as part of protection strategy | ||||||||
Operational hedges | ||||||||
ZCC | | | ||||||
NDF (R$ x US$) | | ( | ||||||
NDF (€ x US$) | | | ||||||
Debt hedges |
|
|
|
| ||||
Swap LIBOR to Fixed (US$) | | | ||||||
Swap IPCA to CDI (notional in Brazilian Reais) | | | ||||||
Swap IPCA to Fixed (US$) | | ( | ||||||
Swap CDI x Fixed (US$) | | ( | ( | |||||
Pre-fixed Swap to US$ (US$) | | ( | ( | |||||
|
|
|
| |||||
Commodity Hedge |
|
|
|
| ||||
Swap US-CPI (US$) (1) | | | | |||||
Swap VLSFO/Brent | ||||||||
| ||||||||
|
| |||||||
Current assets |
|
|
|
|
|
| | |
Non-current assets |
|
|
|
|
|
| | |
Current liabilities |
|
|
|
|
| ( |
| ( |
Non-current liabilities |
|
|
|
|
| ( |
| ( |
|
|
|
|
|
| |
(1) | The embedded derivative refers to a swap contract for the sale of price variations in United States Dollars and US-CPI within the term of a forest partnership with a standing wood supply contract. |
21
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The current contracts and the respective protected risks are set forth below:
(i) | Swap CDI x Fixed US$: positions in conventional swaps exchanging the variation of the Interbank Deposit rate (“DI”) for a fixed rate in United States Dollars (“US$”). The objective is to change the debt indexed in Brazilian Reais to US$, in compliance with the Company’s natural exposure to US$ receivables. |
(ii) | Swap IPCA x CDI (notional in Brazilian Reais): positions in conventional swaps exchanging the variation of the Amplified Consumer Price Index (“IPCA”) for the DI rate. The objective is to change the debt indexed in reais, in compliance with the Company’s cash position in Brazilian Reais, which is also indexed to DI. |
(iii) | Swap IPCA x Fixed US$: positions in conventional swaps exchanging the variations of the IPCA for a fixed rate in US$. The objective is to change the debt indexed in Brazilian Reais to US$, in compliance with the Company’s natural exposure to US$ receivables. |
(iv) | Swap LIBOR x Fixed US$: positions in conventional swaps exchanging a post-fixed rate (LIBOR) for a fixed rate in US$. The objective is to protect the cash flow against changes in the US interest rate. |
(v) | Pre-Fixed Swap R$ x Fixed US$: positions in conventional swaps of a fixed rate in Reais for a fixed rate in US$. The objective is to change the exposure of debts in Brazilian Reais to US$, in compliance with the Company’s natural exposure to US$ receivables. |
(vi) | Zero-Cost Collar (“ZCC”): positions in an instrument that consists of the simultaneous combination of a purchase of put options and the sale of call options in US$, with the same principal amount and maturity, with the objective of protecting the cash flow of exports. Under this strategy, an interval is established where there is no deposit or receipt of financial margin at the option maturity. The objective is to protect the cash flow of exports against the depreciation of the Brazilian Real. |
(vii) | Non-Deliverable Forward contracts (“NDF”): ”): short positions in US$ futures contracts with the objective of protecting the cash flow from exports against the depreciation of the Brazilian Real. |
(viii) | Swap US-CPI: The embedded derivative refers to the swap contracts for selling price variations in US$ and the US-CPI in forest partnership with a standing wood supply contract. |
(ix) | Non-Deliverable Forward contracts: EUR and US$: call positions at EUR/US$ parity to protect the Capex cash flow of the Cerrado project against the appreciation of the Euro. |
(x) | Swap Very Low Sulphur Fuel Oil / Brent (“VLSFO”): Long positions in oil, aimed at hedging logistical costs related to maritime freight contracts against the increase in oil prices. |
The variation in the fair values of derivatives on June 30, 2023 compared to the fair values measured on December 31, 2022 are explained substantially by the appreciation of the Brazilian Real against the US Dollar and by settlements during the period. There were also impacts caused by the variations in the Pre, Foreign Exchange Coupon and LIBOR curves in the operations.
It is important to highlight that the outstanding agreements on June 30, 2023 are over-the-counter market operations, without any type of collateral margin or forced early settlement clause due to variations from market marking.
4.5.2.Fair value by maturity schedule
June 30, | December 31, | |||
| 2023 |
| 2022 | |
2023 | | |||
2024 | | |||
2025 | ( | ( | ||
2026 onwards |
| ( |
| ( |
|
| |
22
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
4.5.3.Outstanding assets and liabilities derivatives positions
The outstanding derivatives positions are set forth below:
Notional value | Fair value | |||||||||
June 30, | December 31, | June 30, | December 31, | |||||||
| Currency |
| 2023 |
| 2022 |
| 2023 |
| 2022 | |
Debt hedges |
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
Swap CDI to Fixed (US$) |
| R$ |
|
| |
|
| | ||
Swap Pre-Fixed to US$ | R$ | | | |||||||
Swap LIBOR to Fixed (US$) |
| US$ |
|
| |
|
| | ||
Swap IPCA to CDI | IPCA | | | |||||||
Swap IPCA to US$ | IPCA | | ||||||||
|
|
|
|
| | |||||
Liabilities |
|
|
|
|
|
| ||||
Swap CDI to Fixed (US$) |
| US$ |
|
| |
| ( |
| ( | |
Swap Pre-Fixed to US$ |
| US$ |
|
| |
| ( |
| ( | |
Swap LIBOR to Fixed (US$) | US$ | | ||||||||
Swap IPCA to CDI | R$ | | ( | ( | ||||||
Swap IPCA to US$ | US$ | |
| ( | ||||||
|
|
|
|
| ( |
| ( | |||
|
|
|
|
| ( |
| ( | |||
Operational hedge | ||||||||||
Zero cost collar (US$ x R$) | US$ | | | |||||||
NDF (R$ x US$) | US$ | | ( | |||||||
NDF (€ x US$) | US$ | | | |||||||
| ||||||||||
Commodity hedge | ||||||||||
Swap US-CPI (standing wood) (1) | US$ | | | | | |||||
Swap VLSFO/Brent | US$ | |||||||||
| ||||||||||
|
(1) | The embedded derivative refers to the swap contracts for selling price variations in US$ and the US-CPI in forest partnership with a standing wood supply contract. |
23
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
4.5.4.Fair value settled amounts
The settled derivatives positions are set forth below:
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Operational hedge |
|
|
|
|
Zero cost collar (R$ x US$) |
|
| | |
NDF (R$ x US$) | | |||
NDF (€ x US$) |
|
| | |
| ||||
Commodity hedge |
|
| ||
Swap VLSFO/other |
| |||
Debt hedge |
|
| ||
Swap CDI to Fixed (US$) |
| ( |
| ( |
Swap IPCA to CDI (Brazilian Reais) |
|
| ( | |
Swap IPCA to Fixed (US$) | ( | | ||
Swap Pre-Fixed to US$ |
|
| | |
Swap LIBOR to Fixed (US$) | ( | |||
( | ||||
|
4.6.Fair value hierarchy
Financial instruments are measured at fair value, which considers the fair value as the price that would be received from selling an asset or paid to transfer a liability in an unforced transaction between market participants at the measurement date.
For the six-month period ended June 30, 2023, there were no changes between the 3 (three) levels of hierarchy and no transfers between levels 1, 2 and 3.
June 30, | ||||||
2023 | ||||||
| Level 2 |
| Level 3 |
| Total | |
Assets |
|
|
|
| ||
At fair value through profit or loss | ||||||
Derivative financial instruments | ||||||
Marketable securities | ||||||
At fair value through other comprehensive income | ||||||
Other investments - CelluForce | ||||||
Biological assets | ||||||
Total assets | ||||||
Liabilities | ||||||
At fair value through profit or loss | ||||||
Derivative financial instruments | ||||||
Total liabilities |
24
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
December 31, | ||||||
2022 | ||||||
| Level 2 |
| Level 3 |
| Total | |
Assets |
|
|
|
| ||
At fair value through profit or loss |
|
| ||||
Derivative financial instruments | | | ||||
Marketable securities | | | ||||
| | |||||
At fair value through other comprehensive income | ||||||
Other investments - CelluForce | | | ||||
| | |||||
|
| |||||
Biological assets | | | ||||
| | |||||
Total assets | | | | |||
Liabilities | ||||||
At fair value through profit or loss | ||||||
Derivative financial instruments | | | ||||
| | |||||
Total liabilities | | |
4.7.Climate change
In the annual financial statements for the year ended December 31, 2022, the risks and opportunities information linked to climate change and the sustainability strategy were disclosed, which did not change significant during the six-month period ended June 30, 2023, except for the items presented in Note 4.7.1.
4.7.1.Opportunities linked to climate change and the sustainability strategy
4.7.1.1Biomas
As disclosed in Note 1.2.6, Suzano and five other global companies created Biomas with objective of restoring, conserving and preserving native forests in Brazil.
The initiative aims to restore and protect, over a period of 20 years, native forest in some of Brazil´s most valuable ecosystems, such as the Amazon, Atlantic Forest and Cerrado biomes – The area is equivalent to the territory of Switzerland or the state of Rio de Janeiro, in Brazil.
The initiative aims to promote a sustainable business model from a financial perspective, enabling each restoration, conservation, and preservation projects to be viable through the commercialization of carbon credits, as removals and avoided emissions, reducing tons of CO2e from the atmosphere.
The first stage will involve the identification and prospecting of areas, promoting nurseries for the large-scale production of native trees, engaging local communities in Biomas activities, discussing the application of the project in public areas, partnering with carbon certification platforms and implementing pilot projects.
4.7.1.2Generation of carbon credits
The Company has ongoing carbon credit projects certifications, including:
● | Horizonte de Carbono Project, which aims to restore degraded areas through the reforestation of native and eucalyptus trees. On March 30, 2023, the certifier Verra completed the validation and verification of 1.9Mt CO2e of the Horizonte Project (VCS ID 3350), of which 10% will be allocated to the Verra reserve and 1.7Mt CO2e is eligible for the issuance of credits. The Company has not yet issued such credits. |
25
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The carbon credits are registered by Verra, an accredited company that holds a global platform, which is also responsible for the custody of the credits. This company has developed the Verified Carbon Standard (VCS) program, currently regarded as the global reference standard, in the best understanding of the company.
4.7.1.3Production of wood-based textile fiber
In May 2023, Woodspin, located in Finland, inaugurated the first factory producing sustainable, recyclable and fully biodegradable textile fiber from responsibly grown wood, the result of the joint venture between Spinnova and Suzano. This new type of “green fabric” has the potential to replace less sustainable materials used in many products. This unit will be used for market development and technology improvement.
For the construction and operation of textile fiber projects, Woodspin uses Suzano’s microfibrillated cellulose (MFC) as raw material.
4.8.Capital management
The main objective is to strengthen the Company’s capital structure, aiming to maintain an appropriate level of financial leverage while mitigating risks that could affect the availability of capital for business development.
The Company continuously monitors significant indicators, such as consolidated financial leverage, which is the ratio of total net debt to adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (“Adjusted EBITDA”).
5.CASH AND CASH EQUIVALENTS
Average yield | June 30, | December 31, | ||||
| p.a. % |
| 2023 |
| 2022 | |
Cash and banks (1) | |
|
| | ||
Cash equivalents | ||||||
Local currency |
|
| ||||
Fixed-term deposits (compromised) |
|
| | |||
|
| |||||
Foreign currency |
| |||||
Fixed-term deposits (2) | |
|
| |||
|
| |
(1) | Refers mainly to investments in foreign currency under the Sweep Account modality, which is a remunerated account the balance of which is invested and made available automatically each day. |
(2) | Refers to Time Deposit applications, with maturity up to 90 days, which is a remunerated bank deposit with a specific maturity period and is subject to an insignificant risk of changes in value. |
26
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
6.MARKETABLE SECURITIES
Average yield | June 30, | December 31, | ||||
| p.a. % |
| 2023 |
| 2022 | |
In local currency | ||||||
Private funds |
|
| | |||
Private Securities (“CDBs”) | | |||||
CDBs - Escrow Account (1) | | |||||
|
| | ||||
Foreign currency | ||||||
Time deposits (2) | | |||||
Other | | |||||
| ||||||
| ||||||
Current | | |||||
Non-Current | |
(1) | Includes escrow accounts, which will be released only after obtaining the applicable governmental approvals, and pending compliance by the Company with the conditions precedent in transactions involving the sale of rural properties. |
(2) | Refers to Time Deposit investments, with maturities over 90 days, which are remunerated bank deposits with specific maturity periods. |
7.TRADE ACCOUNTS RECEIVABLE
7.1.Breakdown of balances
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Domestic customers |
|
|
|
|
Third parties |
|
| | |
Related parties (Note 11) (1) |
|
| | |
Foreign customers |
|
| ||
Third parties |
|
| | |
(-) Expected credit losses |
| ( |
| ( |
|
| |
(1)The balance refers to transactions with Ibema Companhia Brasileira de Papel.
The Company carries out factoring transactions for certain customer receivables where transfers the control and all risks and rewards related to these receivables to the counterparty, so these receivables are derecognized from accounts receivable in the balance sheet. This transaction refers to an additional cash generation opportunity and is therefore classified as a financial asset measured at amortized cost. The impact of these factoring transactions on the accounts receivable as of June 30, 2023, was R$
27
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
7.2.Breakdown of trade accounts receivable by maturity
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Current |
|
| | |
Overdue | ||||
Up to 30 days |
|
| | |
From 31 to 60 days |
|
| | |
From 61 to 90 days |
|
| | |
From 91 to 120 days |
|
| | |
From 121 to 180 days |
|
| | |
From 181 days |
|
| | |
|
| |
7.3.Roll-forward of expected credit losses
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Opening balance |
| ( | ( | |
Additions |
| ( | ( | |
Reversals |
| | ||
Write-offs |
| | ||
Exchange rate variations |
| | ||
Closing balance |
| ( | ( |
The Company maintains guarantees for overdue receivables as part of its commercial operations, through credit insurance policies, letters of credit and other guarantees. These guarantees avoid the need to recognize expected credit losses, in accordance with the Company’s credit policy.
7.4.Main customers
The Company has
8.INVENTORIES
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Finished goods |
|
|
|
|
Pulp |
|
|
|
|
Domestic (Brazil) |
|
| | |
Foreign |
|
| | |
Paper |
| |||
Domestic (Brazil) |
|
| | |
Foreign |
|
| | |
Work in process |
|
| | |
Raw materials |
|
| ||
Wood | | |||
Operating supplies and packaging | | |||
Spare parts and other |
|
| | |
|
| |
Inventories are disclosed net of estimated losses.
28
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
8.1.Roll-forward of estimated losses
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Opening balance |
| ( |
| ( |
Additions |
| ( |
| ( |
Reversals | | |||
Write-offs | | |||
Closing balance |
| ( |
| ( |
On June 30, 2023 and December 31, 2022, there were
9.RECOVERABLE TAXES
June 30, | December 31, | |||
| 2023 |
| 2022 | |
IRPJ/CSLL – prepayments and withheld taxes |
| | ||
PIS/COFINS – on acquisitions of property, plant and equipment (1) |
| | ||
PIS/COFINS – operations |
| | ||
PIS/COFINS – exclusions from ICMS (2) | | |||
ICMS – on acquisitions of property, plant and equipment (3) |
| | ||
ICMS – operations (4) |
| | ||
Reintegra program (5) |
| | ||
Other taxes and contributions |
| | ||
Provision for loss on ICMS credits (6) |
| ( | ( | |
| | |||
Current |
| | ||
Non-current |
| |
1) | Social Integration Program (“PIS”) and Social Security Funding Contribution (“COFINS”): Credits whose realization is based on the years of depreciation of the corresponding asset. |
2) | The Company and its subsidiaries filed lawsuits over the years seeking the exclusion of ICMS from the PIS and COFINS contribution tax basis, in relation to certain transactions during various periods from March 1992, details on the initial recognition were disclosed in the financial statements of December 31, 2021. |
3) | Tax on Sales and Services (“ICMS”): Credits from the acquisition of property, plant and equipment are recovered on a straight-line basis over a four-year period, from the acquisition date, in accordance with the relevant regulation, the ICMS Control on Property, Plant and Equipment (“CIAP”). |
4) | ICMS credits accrued due to the volume of exports and credit generated from product import transactions: Credits are concentrated in the States of Espírito Santo, Maranhão, Mato Grosso do Sul e São Paulo, where the Company realizes the credits through the sale of credits to third parties, after approval from the State Ministry of Finance of each State. Credits are also being realized through the consumption of consumer goods (tissue) transactions in the domestic market. |
5) | Special Regime of Tax Refunds for Export Companies (“Reintegra”): Reintegra is a program that aims to refund the residual costs of taxes paid throughout the export chain to taxpayers, to make them more competitive in foreign markets. |
6) | Related to provisions for ICMS credit balances that are not probable to be recovered. |
29
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
9.1.Roll-forward of provision for loss
| ICMS | |||
June 30, | December 31, | |||
2023 | 2022 | |||
Opening balance |
| ( |
| ( |
Addition (1) |
| ( |
| ( |
Write-off |
|
| | |
Reversal | | | ||
Closing balance | ( | ( |
1) | Refers, substantially, to the accumulated ICMS credits of the state of Mato Grosso do Sul, arising from the construction operations of the Cerrado Project, and of the state of Espirito Santo, of the accumulated credits due to the volume of exports. |
10.ADVANCES TO SUPPLIERS
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Forestry development program and partnerships |
|
| | |
Advance to suppliers - others |
|
| | |
|
| | ||
Current |
|
| | |
Non-current |
|
| |
In the annual financial statements for the year ended December 31, 2022, the characteristics of the advances were disclosed, which did not change during the six-month period ended June 30, 2023.
11.RELATED PARTIES
The Company’s commercial and financial transactions with the controlling shareholder and Companies owned by the controlling shareholder Suzano Holding S.A. (“Suzano Group”) were carried out at specific prices and conditions, as well as the corporate governance practices adopted by the Company, and those recommended and/or required by the applicable legislation.
The transactions refers mainly to:
Assets: (i) accounts receivable from the sale of pulp, paper, tissue and other products; (ii) dividends receivable; (iii) reimbursement for expenses; and (iv) social services;
Liabilities: (i) loan agreements;(ii) reimbursement for expenses; (iii) social services; (iv) real estate consulting; and (v) dividends payable.
Amounts in the statements of income: (i) sale of pulp, paper, tissue and other products; (ii) loan charges and exchange variation; (iii) social services and (viii) real estate consulting.
For the six-month period ended June 30, 2023, there were no material changes in the terms of the agreements, deals and transactions entered into, nor were there any new contracts, agreements or transactions of any different nature entered into between the Company and its related parties.
30
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
11.1.Balances recognized in assets and liabilities and amounts of transactions during the period
Assets | Liabilities | Sales (purchases), net | ||||||||||
June 30, | December 31, | June 30, | December 31, | June 30, | June 30, | |||||||
| 2023 |
| 2022 |
| 2023 |
| 2022 |
| 2023 |
| 2022 | |
Transactions with controlling shareholders |
|
| ||||||||||
Suzano Holding |
| | ||||||||||
| ||||||||||||
|
| |||||||||||
Transactions with companies of the Suzano Group and other related parties |
|
|
| |||||||||
Management (expect compensation - Note 11.2) |
| ( | ( |
| ( |
| ( | |||||
Bexma Participações Ltda |
|
|
| | ||||||||
Bizma Investimentos Ltda |
|
|
| | ||||||||
Civelec Participações Ltda |
| |
|
| ||||||||
Fundação Arymax | | |||||||||||
Ibema Companhia Brasileira de Papel (1) | ( | ( | | |||||||||
Instituto Ecofuturo - Futuro para o Desenvolvimento Sustentável |
| ( | ( |
| ( |
| ( | |||||
IPLF Holding S.A. | | | ||||||||||
Nemonorte Imóveis e Participações Ltda |
|
| ( |
| ( | |||||||
| ( | ( |
|
| | |||||||
| ( | ( |
|
| | |||||||
Assets |
|
|
|
|
| |||||||
Trade accounts receivable (Note 7) |
| |
| |||||||||
Dividends receivable | | |||||||||||
Other assets | | |||||||||||
Liabilities |
|
| ||||||||||
Trade accounts payable (Note 17) | ( | ( | ||||||||||
| ( | ( |
|
1) Refers mainly to the sale of pulp.
11.2.Management compensation
Expenses related to the compensation of key management personnel, which include the Board of Directors, Fiscal Council and Board of Statutory Executive Officers, recognized in the statement of income for the period, are set out below:
June 30, | June 30, | |||
| 2023 |
| 2022 | |
Short-term benefits |
|
|
|
|
Salary or compensation |
|
| | |
Direct and indirect benefits |
|
| | |
Bonus |
|
| | |
|
| | ||
Long-term benefits |
|
| ||
Share-based compensation plan |
|
| | |
|
| | ||
|
| |
Short-term benefits include fixed compensation (salaries and fees, vacation pay, mandatory bonus and “13th month’s salary” bonus), payroll charges (Company’s share of contributions to social security – “INSS”) and variable compensation such as profit sharing, bonuses and benefits (company car, health plan, meal voucher, market voucher, life insurance and private pension plan).
Long-term benefits include the stock option plan and phantom shares for executives and key members of Management, in accordance with the specific regulations disclosed in Note 22.
31
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
12.INCOME AND SOCIAL CONTRIBUTION TAXES
12.1.Deferred taxes
The Company calculates income tax and social contribution taxes, current and deferred, based on the following rates: (i)
Subsidiaries domiciled in Brazil have their taxes calculated and provisioned in accordance with the current legislation and their specific tax regime, including, in some cases, the presumed profit method. Subsidiaries domiciled abroad are subject to taxation in their respective jurisdictions, according to local regulations.
Deferred income and social contribution taxes are recognized at the net amounts in non-current assets or liabilities.
In Brazil, Law nº. 12,973/14 revoked article 74 of Provisional Measure nº. 2,158/01 and determines that the parcel of the adjustment of the value of the investment in subsidiaries, direct and indirect, domiciled abroad, equivalent to the profit earned by them before income tax, except for exchange rate variation, must be added in the determination of taxable income and the social contribution calculation basis of the controlling entity domiciled in Brazil, at each year ended.
The Company management believes in the validity of the provisions of international treaties entered by Brazil to avoid double taxation. In order to ensure its right to non-double taxation, the Company filed a lawsuit in April 2019, which aims to exempt the double taxation in Brazil, of profits earned by its subsidiary located in Austria, according to Law No. 12,973/14. Due to the preliminary injunction granted in favor of the Company in the aforementioned lawsuit, the Company decided not to add the profit from Suzano International Trading GmbH, located in Austria, when determining its taxable income and social contribution basis of the net profit of the Company for the six-month period ended June 30, 2023. There is no provision for tax related to the non-double taxation profits of such subsidiary in 2022.
32
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
12.1.1.Deferred income and social contribution taxes
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Tax loss |
|
| | |
Negative tax basis of social contribution |
|
| | |
Assets - temporary differences | ||||
Provision for judicial liabilities |
|
| | |
Operating provisions and other losses |
|
| | |
Exchange rate variations |
|
| | |
Amortization of fair value adjustments arising from business combinations | | |||
Unrealized profit on inventories | | |||
Leases | | |||
| ||||
Liabilities - temporary differences |
|
| ||
Goodwill - tax benefit on unamortized goodwill |
|
| | |
Property, plant and equipment - deemed cost |
|
| | |
Depreciation accelerated for tax-incentive reason (1) | | |||
Capitalized loan costs | | |||
Fair value of biological assets | | |||
Deferred taxes, net of fair value adjustments | | |||
Tax credits - gains from tax lawsuit (exclusion of ICMS from the PIS and COFINS basis) | | |||
Derivatives gains (“MtM”) | | |||
Provision of deferred taxes on results of subsidiaries abroad | ||||
Other temporary differences |
|
| | |
|
| | ||
Non-current assets | | |||
Non-current liabilities |
|
| |
1)Accelerated tax depreciation is taken as a benefit only in the income tax calculation bases.
33
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
12.1.2.Breakdown of accumulated tax losses and social contribution tax losses carried forward
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Tax loss carried forward |
|
| | |
Negative tax basis of social contribution carried forward |
|
| |
12.1.3.Roll-forward of deferred tax assets
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Opening balance |
| |
| |
Tax loss |
| ( |
| |
Negative tax basis of social contribution |
|
| | |
Provision for judicial liabilities |
|
| | |
Operating provisions and other losses |
|
| | |
Exchange rate variation |
| ( |
| ( |
Derivative gains (“MtM”) |
| ( |
| ( |
Amortization of fair value adjustments arising from business combinations |
|
| | |
Unrealized profit on inventories |
| ( |
| |
Leases |
| ( |
| ( |
Goodwill - tax benefit on unamortized goodwill |
| ( |
| ( |
Property, plant and equipment - deemed cost |
|
| | |
Depreciation accelerated for tax-incentive reason |
|
| | |
Capitalized loan costs |
| ( |
| ( |
Fair value of biological assets |
| ( |
| ( |
Deferred taxes on the results of subsidiaries abroad |
| ( |
|
|
Credits on exclusion of ICMS from the PIS/COFINS tax base |
|
| | |
Other temporary differences |
| ( | ( | |
Closing balance |
|
| |
34
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
12.2.Reconciliation of the effects of income tax and social contribution on profit or loss
June 30, | June 30, | |||
| 2023 |
| 2022 | |
Net income (loss) before taxes |
|
| | |
Income tax and social contribution benefit (expense) at the statutory nominal rate of |
| ( |
| ( |
Tax effect on permanent differences |
|
| ||
Taxation (difference) on profits of subsidiaries in Brazil and abroad (1) |
|
| | |
Equity method |
|
| | |
Thin capitalization (2) | ( | ( | ||
Credit related to the Reintegra Program |
|
| | |
Director bonuses | ( | ( | ||
Tax incentives | | |||
Donations/Fines – Other | ( | ( | ||
| ( |
| ( | |
Income tax |
|
| ||
Current |
| ( |
| ( |
Deferred |
| ( |
| ( |
| ( |
| ( | |
Social Contribution |
|
| ||
Current |
| ( |
| ( |
Deferred |
| ( |
| ( |
| ( |
| ( | |
Income and social contribution benefits (expenses) for the period |
| ( |
| ( |
Effective rate of income and social contribution tax expenses |
|
1) | The difference in the taxation of subsidiaries is substantially due to the differences between the nominal tax rates in Brazil and those of subsidiaries located abroad. |
2) | The Brazilian thin capitalization rules establish that interest paid or credited by a Brazilian entity to a related party abroad may only be deducted for income tax and social contribution purposes if the interest expense is viewed as necessary for the activities of the local entity, and when certain limits and requirements are met. On June 30, 2023 and June 30, 2022, the Company did not meet all of the limits and requirements, and therefore the expense is not deductible for the period. |
12.3.Tax incentives
The Company benefits from a tax incentive for partial reduction of the income tax obtained from operations carried out in areas under the jurisdiction of the Northeast Development Superintendence (“SUDENE”) and the Superintendence of Amazon Development (“SUDAM”). The IRPJ reduction incentive is calculated based on the activity profits (exploitation profits) and considers the allocation of the operating profit based on the incentive production levels for each product.
Area/Regions |
| Company |
| Maturity |
Northeast Development Superintendence (“SUDENE”) | ||||
Mucuri (BA) - Line 1 |
| Suzano |
| 2024 |
Mucuri (BA) - Line 2 |
| Suzano |
| 2027 |
Eunápolis (BA) |
| Veracel |
| 2025 |
Imperatriz (MA) |
| Suzano |
| 2024 |
Aracruz (ES) |
| Portocel |
| 2030 |
Aracruz (ES) |
| Suzano |
| 2031 |
Superintendence of Amazon Development (“SUDAM”) |
|
|
|
|
Belém (PA) |
| Suzano |
| 2025 |
35
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
13.BIOLOGICAL ASSETS
The roll-forward of biological assets is as set forth below:
June 30, | December 31, | |||
2023 | 2022 | |||
Opening balance |
| |
| |
Additions |
| |
| |
Depletions | ( | ( | ||
Gain on fair value adjustments | | | ||
Disposals | ( | ( | ||
Other write-offs | ( | ( | ||
Closing balance | | |
The calculation of fair value of the biological assets falls under Level 3 in the hierarchy set forth in IFRS 13 — Measurement of Fair Value, due to the complexity and structure of the calculation.
The assumptions such as the average annual growth (“IMA”), discount rate, and average gross selling price of eucalyptus, stand out as being the most sensitive, where increases or reductions in these assumptions could generate significant gains or losses in the measurement of fair value.
The assumptions used in the measurement of the fair value of biological assets were as follow:
i) | Average cycle of forest formation between and |
ii) | Effective area of forest from the |
iii) | The IMA consists of the estimated volume of production of wood with bark in m3 per hectare, ascertained based on the genetic material used in each region, silvicultural practices and forest management, production potential, climate factors and soil conditions; |
iv) | The estimated average standard cost per hectare includes silvicultural and forest management expenses, applied to each year of formation of the biological cycle of the forests, plus the costs of land lease agreements and the opportunity cost of owning land; |
v) | The average gross selling prices of eucalyptus were based on specialized research on transactions carried out by the Company with independent third parties; and |
vi) | The discount rate used in cash flows is measured based on the capital structure and other economic assumptions of an independent market participant in the sale of standing wood (forests). |
The table below discloses the measurement of the premises adopted:
| June 30, | December 31, | ||
| 2023 |
| 2022 | |
Planted useful area (hectare) |
| |||
Mature assets |
| |||
Immature assets |
| |||
Average annual growth (IMA) - m3/hectare /year |
| |||
Average gross sale price of eucalyptus - R$/m3 |
| |||
Discount rate - % (post-tax) |
|
36
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The pricing model considers the net cash flows, after the deduction of taxes on profit at the applicable rates.
The fair value adjustment justified by the combined variations of the indicators mentioned above resulted in a positive variation of R$
June 30, |
| December 31, | ||
| 2023 |
| 2022 | |
Physical changes |
| ( | ||
Price |
| |||
|
The Company manages the financial and climate risks related to its agricultural activities in a preventive manner. To reduce the risks arising from edaphoclimatic factors, the weather is monitored through meteorological stations and, in the event of pests and diseases, our Department of Forestry Research and Development, an area specialized in physiological and phytosanitary aspects, has procedures to diagnose and act rapidly against possible occurrences and losses.
The Company has
14.INVESTMENTS
14.1.Investments breakdown
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Investments in associates and joint ventures |
| |
| |
Goodwill |
| |
| |
Other investments evaluated at fair value through other comprehensive income - Celluforce |
| |
| |
| |
| |
14.2.Investments in associates and joint ventures
Information of joint ventures as at | Company Participation | |||||||||||||
June 30, | In the income(expenses) for | |||||||||||||
2023 |
| Carrying amount | the period | |||||||||||
Income |
|
|
|
| ||||||||||
(expenses) | Participation | |||||||||||||
of the | equity | June 30, | December 31, | June 30, | June 30, | |||||||||
| Equity |
| period |
| (%) | 2023 |
| 2022 |
| 2023 |
| 2022 | ||
Associate | ||||||||||||||
Ensyn Corporation |
| ( |
| |
| ( |
| | ||||||
Spinnova Plc (1) |
|
| |
| ( |
| ( | |||||||
|
| ( | | |||||||||||
Joint ventures |
|
|
|
|
|
|
|
|
| |||||
Domestic (Brazil) | ||||||||||||||
Biomas | ( | ( | ||||||||||||
Ibema Companhia Brasileira de Papel |
|
| |
|
| | ||||||||
Foreign | ||||||||||||||
F&E Technologies LLC |
|
| |
| ||||||||||
Woodspin Oy | ( | | ( | ( | ||||||||||
| |
|
| | ||||||||||
Other movements | | ( | ( | |||||||||||
| ( | ( | ||||||||||||
|
| |
|
| |
1) | The average share price quoted on the Nasdaq First North Growth Market (NFNGM) was EUR |
37
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
15.PROPERTY, PLANT AND EQUIPMENT
Machinery, | ||||||||||||
equipment and | Work in | |||||||||||
| Land |
| Buildings |
| facilities |
| progress |
| Other (1) |
| Total | |
Average rate % | ||||||||||||
Accumulated cost | | | | | | | ||||||
Accumulated depreciation | ( | ( | ( | ( | ||||||||
Balance as of December 31, 2021 | | | | | | | ||||||
Additions | | | | | | | ||||||
Additions of merged companies | | | ||||||||||
Write-offs | ( | ( | ( | ( | ( | |||||||
Depreciation | ( | ( | ( | ( | ||||||||
Transfers | | | | ( | | ( | ||||||
Accumulated cost | | | | | | | ||||||
Accumulated depreciation | ( | ( | ( | ( | ||||||||
Balance as of December 31, 2022 | | | | | | | ||||||
Additions (2) | | | | | | |||||||
Amounts from the acquisition of MMC Brasil (3) | | | | | | | ||||||
Write-offs | ( | ( | ( | ( | ( | |||||||
Depreciation | ( | ( | ( | ( | ||||||||
Transfers | | | | ( | | ( | ||||||
Accumulated cost | | | | | | | ||||||
Accumulated depreciation | ( | ( | ( | ( | ||||||||
Balance as of June 30, 2023 | | | | | | |
1) | Includes vehicles, furniture and utensils and computer equipment. |
2) | The addition of work in progress refers, mainly to the Cerrado Project, of which R$ |
3) | On June 1, 2023, the Company completed the acquisition of MMC Brasil Indústria e Comércio Ltda.(Note 1.2.3.) |
On June 30, 2023, the Company evaluated the business, market and climate impacts, and did not identify any event that indicated the need to perform an impairment test and to record any impairment provision for property, plant and equipment.
15.1.Items pledged as collateral
On June 30, 2023, property, plant and equipment items pledged as collateral for loan transactions and legal proceedings, consisting mainly of the units of Suzano and Três Lagoas totalling R$
15.2.Capitalized expenses
For the six-month period ended June 30, 2023, the Company capitalized loan costs in the amount of R$
38
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
16.INTANGIBLE
16.1.Goodwill and intangible assets with indefinite useful lives
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Goodwill - Facepa | | | ||
Goodwill - Fibria |
| |
| |
Goodwill - MMC Brasil (1) | | |||
Other (2) | | | ||
| |
1)Refers to the goodwill of the MMC Brasil business combination, whose allocation of the purchase price is disclosed in note 1.2.3.
2)Refers to other intangible assets with indefinite useful lives such as servitude of passage and electricity.
The goodwill is based on expected future profitability supported by valuation reports, after the purchase price allocation.
Goodwill is allocated to cash-generating units as presented in Note 28.4.
For the six-month period ended June 30, 2023, the Company did not identify any event that indicated the need to perform the impairment test and to record any impairment provision for intangible assets.
16.2.Intangible assets with limited useful lives
| June 30, |
| December 31, | |||
|
| 2023 |
| 2022 | ||
Opening balance |
| |
| | ||
Additions |
| |
| | ||
Fair value adjustment MMC Brasil (1) | | |||||
Write-offs |
|
| ( | |||
Amortization |
| ( |
| ( | ||
Transfers and others |
| |
| | ||
Closing balance |
|
| |
| | |
Represented by | Average rate % | |||||
Non-competition agreements | |
| | |||
Port concessions | | | ||||
Lease agreements |
| |
| | ||
Supplier agreements |
| |
| | ||
Port service contracts |
| |
| | ||
Cultivars |
| |
| | ||
Trademarks and patents(1) |
| |
| | ||
Customer portfolio |
| |
| | ||
Supplier agreements |
| |
| | ||
Software |
| |
| | ||
Other |
| |
| | ||
| |
| | |||
Cost | | | ||||
Amortization | ( | ( | ||||
Closing balance | | |
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil Indústria e Comércio Ltda.(Note 1.2.3.)
39
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
17.TRADE ACCOUNTS PAYABLE
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
In local currency |
|
|
|
|
Related party (Note 11.1) (1) |
|
| | |
Third party (2)(3) |
|
| | |
In foreign currency |
|
| ||
Third party (3) |
|
| | |
|
| |
1) | The balance refers mainly to transactions with Ibema Companhia Brasileira de Papel. |
2) | Within the balance of suppliers, there are values under supplier finance arrangement that were subject to anticipation with financial institutions at the exclusive option of certain suppliers, without changing the originally defined purchase conditions (payment terms and negotiated prices). The balance related to such operations on June 30, 2023 was R$ |
3) | Within the balance of suppliers, the following balances refer to the Cerrado Project, R$ |
18.LOANS, FINANCING AND DEBENTURES
18.1.Breakdown by type
Current | Non-current | Total | ||||||||||||||
Average | ||||||||||||||||
annual | ||||||||||||||||
interest rate - | June 30, | December 31, | June 30, | December 31, | June 30, | December 31, | ||||||||||
Type |
| Interest rate |
| % |
| 2023 |
| 2022 |
| 2023 |
| 2022 |
| 2023 |
| 2022 |
In foreign currency | ||||||||||||||||
BNDES |
| UMBNDES | |
|
| | ||||||||||
Bonds | Fixed | | | | ||||||||||||
Export credits (“export prepayments”) | LIBOR/Fixed | | | | ||||||||||||
Assets financing | SOFR | | | | ||||||||||||
IFC - International Finance Corporation | SOFR | |||||||||||||||
Others | | | ||||||||||||||
| | | ||||||||||||||
In local currency | ||||||||||||||||
BNDES | TJLP |
| | | | |||||||||||
BNDES | TLP |
| | | | |||||||||||
BNDES | Fixed |
| | | | |||||||||||
BNDES | SELIC |
| | | | |||||||||||
CRA (“Agribusiness Receivables Certificates”) | CDI/IPCA |
| | | ||||||||||||
NCE (“Export credit notes”) | CDI |
| | | | |||||||||||
NCR (“Rural producer certificates”) | CDI |
| | | | |||||||||||
Export credits (“export prepayments”) | Fixed |
| | | | |||||||||||
Debentures | CDI | | | | ||||||||||||
| | | ||||||||||||||
| | | ||||||||||||||
Interest on financing | | | ||||||||||||||
Non-current funding | | | | |||||||||||||
| | |
40
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
41
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
18.2.Breakdown by maturity – non - current
2029 | ||||||||||||||
| 2024 |
| 2025 |
| 2026 |
| 2027 |
| 2028 |
| onwards |
| Total | |
In foreign currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds |
| |||||||||||||
Export credits (“export prepayments”) |
| |||||||||||||
Assets financing | ||||||||||||||
IFC - International Finance Corporation | ||||||||||||||
| ||||||||||||||
In local currency |
| |||||||||||||
BNDES – TJLP |
| |||||||||||||
BNDES – TLP |
| |||||||||||||
BNDES – Fixed |
| |||||||||||||
BNDES – SELIC |
| |||||||||||||
NCE (“Export credit notes”) |
| |||||||||||||
NCR (“Rural producer certificates”) |
| |||||||||||||
Debentures |
| |||||||||||||
| ||||||||||||||
|
18.3.Roll-forward of loans, financing and debentures
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Opening balance |
| |
| |
Fundraising, net of issuance costs |
| |
| |
Interest accrued |
| |
| |
Monetary and exchange rate variations, net |
| ( |
| ( |
Settlement of principal |
| ( |
| ( |
Settlement of interest |
| ( |
| ( |
Amortization of fundraising costs |
| |
| |
Others (fair value adjustments to on business combinations) |
|
| | |
Closing balance |
| |
| |
18.4.Breakdown by currency
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Brazilian Reais |
|
| | |
U.S. Dollars |
|
| | |
Currency basket |
|
| | |
|
| |
42
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
18.5.Fundraising costs
The fundraising costs are amortized based on the terms of agreements and the effective interest rate.
|
|
| Balance to be amortized | |||||
June 30, | December 31, | |||||||
Type |
| Cost |
| Amortization |
| 2023 |
| 2022 |
Bonds |
|
|
|
| | |||
CRA and NCE |
|
|
|
| | |||
Export credits (“export prepayments”) |
|
|
|
| | |||
Debentures |
|
|
|
| | |||
BNDES |
|
|
|
| | |||
IFC - International Finance Corporation | ||||||||
Others |
|
|
|
| | |||
|
|
| |
18.6.Guarantees
Some loan and financing agreements have guarantees clauses, in which the financed equipment or other property, plant and equipment are offered as collateral by the Company, as disclosed in Note 15.1.
The Company does not have contracts with restrictive financial clauses (financial covenants) which must be complied with.
18.7.Relevant transactions entered into during the period
18.7.1.BNDES
On June 27, 2023, the Company raised R$
18.7.2.International Finance Corporation (“IFC”)
On December 22, 2022, the Company obtained a new credit line (“A&B Loan”) to be financed by the International Finance Corporation (IFC) and a syndicate of commercial banks, in a total amount of US$
The financing consists of the following parts: (i) “A-loan” in the amount of US$
This credit line was fully utilized by June 30, 2023.
The credit operation has sustainability performance indicators (KPIs) associated with goals for: (a) reducing greenhouse gas (GHG) emissions intensity, and (b) increasing the representation of women in leadership positions within the Company. The funds will be allocated to the Cerrado Project.
18.7.3.Advance of exchange contract (“ACC”)
On May 19, 2023, the Company raised US$
On June 21, 2023, the Company raised US$
43
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
18.7.4.Debenture
On June 29, 2023, the Company issued debenture in the amount of R$
The debenture consists of two parts: (i) an amount of R$
18.8.Significant transactions settled during the period
On June 22, 2023, the Company settled a CRA contract in the amount of R$
19.LEASES
19.1.Right of use
The balances rolled forward are set out below:
|
|
|
|
|
| |||||||
Machinery and | Ships and | |||||||||||
| Lands |
| equipment |
| Buildings |
| boats |
| Vehicles |
| Total | |
Balance as at December 31, 2021 |
| |
| |
| |
| |
| |
| |
Additions/updates |
| | | | | | ||||||
Depreciation (1) |
| ( | ( | ( | ( | ( | ( | |||||
Write-offs (2) | ( | ( | ||||||||||
Balance as at December 31, 2022 |
| |
| |
| |
| |
| |
| |
Additions/updates | ||||||||||||
Depreciation (1) | ( | ( | ( | ( | ( | ( | ||||||
Write-offs (2) | ( | ( | ||||||||||
Balance as at June 30, 2023 |
1) | The amount of depreciation related to land is substantially reclassified to biological assets to make up the formation costs. |
2) | Write-off due to cancellation of contracts. |
For the six-month period ended June 30, 2023, the Company does not have commitments to lease agreements not yet in force.
19.2.Lease liabilities
The balance of lease payables on June 30, 2023, measured at present value and discounted at the respective discount rates are set forth below:
| Average rate - |
|
| Present value of | ||
Nature of agreement |
| % p.a. (1) |
| Maturity (2) |
| liabilities |
Lands and farms |
|
| April/2050 |
| ||
Machinery and equipment |
|
| April/2035 |
| ||
Buildings |
|
| September/2031 |
| ||
Ships and boats |
|
| February/2039 |
| ||
Vehicles |
|
| July/2026 |
| ||
|
1) | To determine the discount rates, quotes were obtained from financial institutions for agreements with characteristics and average terms similar to the lease agreements. |
2) | Refers to the original maturities of the agreements and, therefore, does not consider eventual renewal clauses. |
44
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
The balances rolled forward are set out below:
June 30, | December 31, | |||
2023 | 2022 | |||
Opening balance |
| |
| |
Additions |
| |
| |
Write-offs (2) | ( | ( | ||
Payments |
| ( |
| ( |
Accrual of financial charges (1) |
| |
| |
Exchange rate variations |
| ( |
| ( |
Closing balance | ||||
Current |
|
| ||
Non-current |
|
|
1) | On June 30, 2023, the amount of R$ |
2) | Write-off due to cancellation of contracts. |
The maturity schedule for future payments not discounted to present value related to lease liabilities is disclosed in Note 4.2.
19.2.1.Amounts recognized in the statement of income for the period
The amounts recognized are set out below:
| June 30, |
| June 30, | |
| 2023 |
| 2022 | |
Expenses relating to short-term assets |
|
| | |
Expenses relating to low-value assets |
|
| | |
|
| |
45
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
20.PROVISION FOR JUDICIAL LIABILITIES
The Company is involved in certain legal proceedings arising in the normal course of its business, which include tax, social security, labor, civil, environment and real estate.
The Company classifies the risk of unfavorable decisions in legal proceedings, based on legal advice, which reflects the estimated probable losses.
The Company’s Management believes that, based on the available information as of the date of these unaudited condensed consolidated interim financial information, its provisions for tax, social security, labor, civil, environment and real estate risks, accounted for according to IAS 37 are sufficient to cover estimated losses related to its legal proceedings, as set forth below:
20.1.Roll-forward and changes in the provisions for probable losses based on the nature of the proceedings, net of judicial deposits
June 30, | ||||||||||
2023 | ||||||||||
Tax and | Civil, | Contingent | ||||||||
social | environment | liabilities | ||||||||
| security |
| Labor |
| and real estate |
| assumed (1) (2) |
| Total | |
Provision balance at the beginning of the period | |
| |
| |
| |
| | |
Payments | ( | ( | ( | ( | ||||||
Reversal | ( | ( | ( | ( | ( | |||||
Additions | ||||||||||
Monetary adjustment | ||||||||||
Provision balance | ||||||||||
Judicial deposits | ( | ( | ( | ( | ||||||
Provision balance at the end of the period |
1) | Amounts arising from tax-related lawsuits with a possible or remote probability of loss in the amount of R$ |
2) | Reversal due to a change in likelihood and/or due to settlement. |
December 31, | ||||||||||
2022 | ||||||||||
Tax and | Civil, | Contingent |
| |||||||
social | environment | liabilities | ||||||||
| security |
| Labor |
| and real estate |
| assumed (1) (2) |
| Total | |
Provision balance at the beginning of the year | |
| |
| |
| |
| | |
Payments | ( |
| ( |
| ( |
|
| ( | ||
Reversal | ( |
| ( |
| ( |
| ( |
| ( | |
Additions | |
| |
| |
|
| | ||
Monetary adjustment | |
| |
| |
|
| | ||
Provision balance | | | | | | |||||
Judicial deposits | ( | ( | ( | ( | ||||||
Provision balance at the end of the year | |
| |
| |
| |
| |
1) | Amounts arising from tax-related lawsuits with a possible or remote probability of loss in the amount of R$ |
2)Reversal due to a change in likelihood and/or due to settlement.
46
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
20.1.1.Tax and social security
On June 30, 2023, the Company has
20.1.2.Labor
On June 30, 2023, the Company has
In general, the provisioned labor proceedings are related primarily to matters frequently contested by employees of agribusiness companies, such as wages and/or severance payments, in addition to suits filed by outsourced employees of the Company.
20.1.3.Civil, environment and real estate
On June 30, 2023, the Company has
The provisioned Civil, environment and real estate proceedings are related primarily to the payment of damages, including those arising from contractual obligations, traffic-related injuries, possessory actions, environmental restoration obligations, claims and others.
20.2.Contingencies with possible losses
The Company is involved in tax, civil and labor lawsuits, whose losses have been assessed as possible by Management, supported by legal counsel, and therefore no provision was recorded:
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Taxes and social security (1) |
|
| | |
Labor |
|
| | |
Civil and environmental (1) |
|
| | |
|
| |
1) | The amounts above do not include the fair value adjustments allocated to possible loss risk contingencies representing R$ |
In the six-month period ended June 30, 2023, there were no significant changes in the main nature of these contingencies compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 20).
20.3.Contingent assets
In the six-month period ended June 30, 2023, there were no significant changes in the main nature of these contingencies compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 20).
47
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
21.EMPLOYEE BENEFIT PLANS
The Company provides supplementary pension plan and defined benefit plan, such as medical assistance and life insurance. The characteristics of such benefits were disclosed in the annual financial statements for the year ended December 31, 2022 (Note 21), which did not change during the six-month period ended June 30, 2023.
21.1.Pension plan
Contributions made by the Company, for Suzano Prev pension plan managed by Brasilprev Seguros e Previdência S.A., for the six-month period ended June 30, 2023 amounted R$
21.2.Defined benefits plan
The Company offers the following post-employment benefits in addition to the pension plans, which are measured based on actuarial calculations and recognized in the unaudited condensed consolidated interim financial information.
The roll-forward of actuarial liabilities prepared based on actuarial report is set forth below:
June 30, | December 31, | |||
2023 | 2022 | |||
Opening balance |
| |
| |
Interest on actuarial liabilities |
| |
| |
Actuarial loss | | |||
Exchange rate variations | ( | |||
Amount arising from the acquisition of MMC Brasil | | |||
Benefits paid |
| ( |
| ( |
Closing balance |
| |
| |
48
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
22.SHARE-BASED COMPENSATION PLAN
For the six-month period ended June 30, 2023, the Company has
The characteristics and measurement method of each plan were disclosed in the annual financial statements for the year ended December 31, 2022 (Note 22), which did not change during the six-month period ended June 30, 2023.
22.1.Long term compensation plans (“PS and SAR”)
The roll-forward arrangements are set out below:
Number of shares | ||||
June 30, | December 31, | |||
| 2023 |
| 2022 | |
Opening balance |
| |
| |
Granted during of the period |
|
| | |
Exercised (1) |
| ( |
| ( |
Exercised due to resignation (1) |
| ( |
| ( |
Abandoned/cancelled due to resignation |
| ( |
| ( |
Closing balance |
|
| |
1) | The average price of the share options exercised and exercised due to termination of employment on June 30, 2023 was R$ |
22.2.Restricted shares plan
The position is set forth below:
| Date of |
|
|
|
| ||||||
execution of | Price on | Restricted year for | |||||||||
Program |
| the contract |
| Grant date |
| grant date |
| Shares Granted |
| transfer of shares | |
2020 |
| 01/02/2020 |
| 01/02/2021 | R$ |
|
| 01/02/2024 | |||
2021 | 01/02/2021 | 01/02/2022 | R$ | 01/02/2025 | |||||||
2022 | 01/02/2022 | 01/02/2023 | R$ | 01/02/2026 | |||||||
2023 | 01/02/2023 | 01/02/2023 | R$ | 01/02/2026 | |||||||
22.3.Measurement assumptions
The amounts corresponding to the services received and recognized are set forth below:
Liabilities and Equity | Statement of income and Equity | |||||||
June 30, | December 31, | June 30, | June 30, | |||||
| 2023 |
| 2022 |
| 2023 |
| 2022 | |
Non-current liabilities |
|
|
|
|
|
|
|
|
Provision for phantom stock plan |
| | ( | ( | ||||
Equity |
| |||||||
Stock options granted |
| | ( | ( | ||||
Shares granted |
| ( | | |||||
( | ( | |||||||
( | ( |
49
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
23.LIABILITIES FOR ASSETS ACQUISITIONS AND SUBSIDIARIES
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Assets acquisitions | ||||
Vitex/Parkia (1) |
|
| | |
| ||||
Business combinations | ||||
Facepa (2) | | |||
Vale Florestar Fundo de Investimento em Participações (“VFFIP”) (3) | | |||
| ||||
| ||||
Current | | |||
Non-current |
|
| |
1) | On June 22, 2022, the Company acquired all the shares of the Parkia structure companies, in the amount of US$ |
2) | Acquired in March 2018, for the amount of R$ |
3) | On August 2014, the Company acquired Vale Florestar S.A. through VFFIP, for a total amount of R$ |
24.SHAREHOLDERS’ EQUITY
24.1Share capital
On June 30, 2023, Suzano’s share capital was R$
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
| Quantity |
| (%) |
| Quantity |
| (%) | |
Controlling Shareholders | ||||||||
Suzano Holding S.A. |
|
|
|
| ||||
Controller |
|
|
|
| ||||
Managements and related persons |
|
|
|
| ||||
Alden Fundo de Investimento em Ações | ||||||||
|
|
|
| |||||
Treasury (Note 24.2) |
|
|
|
| ||||
Other shareholders |
|
|
|
| ||||
|
|
|
|
By a resolution of the Board of Directors, the share capital may be increased, irrespective of any amendments to the Bylaws, up to the limit of
For the six-month period ended June 30, 2023, SUZB3 common shares closed the period quoted at R$
50
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
24.2Treasury shares
In the six-month period ended June 30, 2023, the Company had
On February 28, 2023,
The Company has repurchase programs, approved on October 27, 2022, with a limit of
|
| Average cost |
| Historical |
| Market | ||
Quantity | per share | value | value | |||||
Balances at December 31, 2021 | | | | | ||||
Realization in the restricted stock plan |
| |
| |
| |
| |
Repurchase |
| |
| |
| |
| |
Balances at December 31, 2022 |
| |
| |
| |
| |
Repurchase |
| |
| |
| |
| |
Canceled |
| |
| |
| |
| |
Balances at June 30, 2023 |
| |
| |
| |
| |
25.EARNINGS (LOSS) PER SHARE
25.1Basic
The basic earnings (loss) per share is measured by dividing the profit attributable to the Company’s shareholders by the weighted average number of common shares issued during the period, excluding the common shares acquired by the Company and held as treasury shares.
| June 30, |
| June 30, | |
| 2023 |
| 2022 | |
Resulted of the period attributable to controlling shareholders |
|
| | |
Weighted average number of shares in the period – in thousands |
|
| | |
Weighted average treasury shares – in thousands |
| ( |
| ( |
Weighted average number of outstanding shares – in thousands |
|
| | |
Basic earnings (loss) per common share - R$ |
|
| |
25.2Diluted
The diluted earnings (loss) per share is measured by adjusting the weighted average of outstanding common shares, assuming the conversion of all common shares with dilutive effects.
| June 30, |
| June 30, | |
| 2023 |
| 2022 | |
Resulted of the period attributed to controlling shareholders |
|
| | |
Weighted average number of shares during the period (except treasury shares) – in thousands |
|
| | |
Average number of potential shares (stock options) – in thousands | | |||
Weighted average number of shares (diluted) – in thousands |
|
| | |
Diluted earnings (loss) per common share - R$ |
|
| |
51
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
25.3Profit reserves
Reserves are constituted by the allocation of the Company’s profits, after the allocation for the payment of the minimum mandatory dividends and after the allocation to the various profit reserves.
In April 26, 2023, the shareholders’ meeting approved the retention of profits in the amount of R$
26.NET FINANCIAL RESULT
| June 30, |
| June 30, | |
| 2023 |
| 2022 | |
Financial expenses | ||||
Interest on loans, financing and debentures (1) | ( | ( | ||
Amortization of transaction costs (2) | ( | ( | ||
Interest expenses on lease liabilities (3) | ( | ( | ||
Amortization of fair value adjustments | ( | |||
Other | ( | ( | ||
( | ( | |||
Financial income | ||||
Cash and cash equivalents and marketable securities | | |||
Other | | |||
| ||||
Results from derivative financial instruments | ||||
Income | | |||
Expenses | ( | ( | ||
| | |||
Monetary and exchange rate variations, net |
| |||
Exchange rate variations on loans, financing and debentures |
| | ||
Leases | | |||
Other assets and liabilities (4) | ( |
| ( | |
| ||||
Net financial result |
| |
1) | Excludes R$ |
2) | Includes expense of R$ |
3) | Includes R$ |
4) | Includes effects of exchange rate variations of trade accounts receivable, trade accounts payable, cash and cash equivalents, marketable securities and others. |
52
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
27.NET SALES
June 30, | June 30, | |||
| 2023 |
| 2022 | |
Gross sales |
|
| | |
Sales deductions |
|
| ||
Returns and cancellations |
| ( |
| ( |
Discounts and rebates |
| ( |
| ( |
| ||||
Taxes on sales |
| ( |
| ( |
Net sales |
|
| |
28.SEGMENT INFORMATION
28.1Criteria for identifying operating segments
The Board of Directors and Board of Statutory Executive Officers evaluates the performance of the Company’s business segments through EBITDA.The operating segments defined by the Company’s management are set forth below:
i) | Pulp: comprised of the production and sale of hardwood eucalyptus pulp and fluff pulp, mainly to supply the foreign market. |
ii) | Paper: comprises the production and sale of paper to meet the demands of both the domestic and foreign markets. Consumer goods (tissue) sales are classified under this segment due to their immateriality. |
Information related to total assets by reportable segment is not disclosed, as it is not included in the set of information made available to the Company’s management, which makes investment decisions and determines the allocation of resources on a consolidated basis.
In addition, with respect to geographical information related to non-current assets, the Company does not disclose such information, as all property, plant and equipment, biological and intangible assets are in Brazil.
28.2Information of operating segments
June 30, 2023 |
| ||||||
Pulp | Paper | Total |
| ||||
Net sales |
| ||||||
Domestic market (Brazil) |
| ||||||
Foreign markets |
| ||||||
EBITDA |
| ||||||
Depreciation, depletion and amortization |
| ( | |||||
Operating profit before net financial income (“EBIT”) (1) |
| ||||||
EBITDA margin (%) |
|
1) | (“Earnings before interest and tax”). |
June 30, 2022 | |||||||
| Pulp |
| Paper |
| Total |
| |
Net sales |
| | | | |||
Domestic market (Brazil) |
| | | | |||
Foreign market |
| | | | |||
EBITDA |
| | | | |||
Depreciation, depletion and amortization |
| ( | |||||
Operating profit before net financial income (“EBIT”) (1) |
| | |||||
EBITDA margin (%) |
|
53
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
1) | (“Earnings before interest and tax”). |
28.3Net sales by product
June 30, | June 30, | |||
Products |
| 2023 |
| 2022 |
Market pulp(1) |
|
| | |
Printing and writing paper(2) |
|
| | |
Paperboard |
|
| | |
Other |
|
| | |
|
| |
1) | Net sales of fluff pulp represent approximately |
2) | Net sales of tissue represent approximately |
28.4Goodwill based on expected future profitability
The goodwill based on expected future profitability arising from the business combination was allocated to the disclosable segments, which correspond to the Company’s cash-generating units (“CGUs”), considering the economic benefits generated by such intangible assets. The allocation of goodwill is set out below:
| June 30, |
| December 31, | |
| 2023 |
| 2022 | |
Pulp |
|
| | |
Paper (1) |
|
| | |
|
| |
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil.(Note 1.2.3.)
54
Suzano S.A. Notes to the unaudited condensed consolidated interim financial information Six-month period ended June 30, 2023 |
29.INCOME (EXPENSES) BY NATURE
June 30, | June 30, | |||
| 2023 |
| 2022 | |
Cost of sales |
|
|
|
|
Personnel expenses |
| ( | ( | |
Costs of raw materials, materials and services |
| ( | ( | |
Logistics costs |
| ( | ( | |
Depreciation, depletion and amortization |
| ( | ( | |
Other (1) |
| ( | ( | |
| ( | ( | ||
Selling expenses |
|
| ||
Personnel expenses |
| ( |
| ( |
Services |
| ( |
| ( |
Logistics costs |
| ( |
| ( |
Depreciation and amortization |
| ( |
| ( |
Other (2) |
| ( |
| ( |
| ( |
| ( | |
General and administrative expenses |
|
| ||
Personnel expenses |
| ( |
| ( |
Services |
| ( |
| ( |
Depreciation and amortization |
| ( |
| ( |
Other (3) |
| ( |
| ( |
| ( |
| ( | |
Other operating (expenses) income net |
|
| ||
Rents and leases | | |||
Results from sales of other products, net |
|
| | |
Results from sales and disposals of property, plant and equipment, intangible and biological assets, net |
| ( |
| |
Result on fair value adjustment of biological assets | | |||
Depletion and amortization |
|
| ||
Tax credits - ICMS from the PIS/COFINS calculation basis | ( | |||
Provision for judicial liabilities | ( | ( | ||
Other operating income (expenses), net |
| ( |
| ( |
|
| |
1) | Includes R$ |
2) | Includes expected credit losses, insurance, materials for use and consumption, travel, accommodation, trade fairs and events. |
3) | Includes, substantially, corporate expenses, insurance, materials for use and consumption, social programs and donations, travel and accommodation. |
55
Document and Entity Information |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Document and Entity Information | |
Entity Registrant Name | Suzano S.A. |
Document Type | 6-K/A |
Current Fiscal Year End Date | --12-31 |
Document Period End Date | Jun. 30, 2023 |
Entity Central Index Key | 0000909327 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | Q2 |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCOME (LOSS) - BRL (R$) R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
CONSOLIDATED STATEMENTS OF INCOME (LOSS) | ||||
NET SALES | R$ 9,159,634 | R$ 11,519,655 | R$ 20,436,017 | R$ 21,262,490 |
Cost of sales | (6,228,181) | (6,122,925) | (12,196,855) | (11,555,765) |
GROSS PROFIT | 2,931,453 | 5,396,730 | 8,239,162 | 9,706,725 |
OPERATING INCOME (EXPENSES) | ||||
Selling | (626,809) | (625,567) | (1,231,162) | (1,197,708) |
General and administrative | (427,208) | (364,768) | (817,443) | (701,232) |
Income (expense) from associates and joint ventures | (14,052) | 19,049 | 419 | 9,307 |
Other, net | 1,205,293 | 161,993 | 1,183,989 | 159,426 |
OPERATING PROFIT BEFORE NET FINANCIAL INCOME | 3,068,677 | 4,587,437 | 7,374,965 | 7,976,518 |
NET FINANCIAL INCOME (EXPENSES) | ||||
Financial expenses | (1,149,041) | (1,133,402) | (2,308,066) | (2,183,523) |
Financial income | 404,137 | 194,283 | 789,898 | 352,567 |
Derivative financial instruments | 2,903,766 | (1,575,557) | 4,899,019 | 4,620,886 |
Monetary and exchange variations, net | 2,376,817 | (4,459,984) | 3,624,935 | 3,170,689 |
NET INCOME (LOSS) BEFORE TAXES | 7,604,356 | (2,387,223) | 14,380,751 | 13,937,137 |
Income and social contribution taxes | ||||
Current | (97,226) | (63,703) | (211,003) | (122,637) |
Deferred | (2,429,507) | 2,632,715 | (3,849,332) | (3,326,601) |
NET INCOME FOR THE PERIOD | 5,077,623 | 181,789 | 10,320,416 | 10,487,899 |
Attributable to | ||||
Controlling shareholders' | 5,073,127 | 175,625 | 10,310,498 | 10,480,342 |
Non-controlling interest | R$ 4,496 | R$ 6,164 | R$ 9,918 | R$ 7,557 |
Earnings (loss) per share | ||||
Basic | R$ 3.90544 | R$ 0.13057 | R$ 7.87524 | R$ 7.77949 |
Diluted | R$ 3.90397 | R$ 0.13054 | R$ 7.87231 | R$ 7.77825 |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - BRL (R$) R$ in Thousands |
Share Capital |
Share issuance costs |
Stock options granted |
Treasury shares |
Tax incentives |
Legal Reserve |
Reserve for capital increase |
Special statutory reserve |
Investment reserve |
Dividends proposed |
Other reserves |
Retained earnings (losses) |
Total |
Non-controlling interest |
Total |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning balances at Dec. 31, 2021 | R$ 9,269,281 | R$ (33,735) | R$ 15,455 | R$ (218,265) | R$ 812,909 | R$ 235,019 | R$ 2,513,663 | R$ 279,344 | R$ 0 | R$ 86,889 | R$ 2,114,907 | R$ 0 | R$ 15,075,467 | R$ 99,663 | R$ 15,175,130 |
Total comprehensive income | |||||||||||||||
Net income for the period | 10,480,342 | 10,480,342 | 7,557 | 10,487,899 | |||||||||||
Other comprehensive income for the period | (8,224) | (8,224) | (8,224) | ||||||||||||
Transactions with shareholders: | |||||||||||||||
Stock options granted | 2,668 | 2,668 | 2,668 | ||||||||||||
Shares granted | (2,365) | 2,365 | |||||||||||||
Shares repurchased | (601,551) | (601,551) | (601,551) | ||||||||||||
Unclaimed dividends forfeited | 194 | 194 | 194 | ||||||||||||
Fair value attributable to non-controlling interests | (2,539) | (2,539) | |||||||||||||
Proposed additional dividend payment | (97) | (86,889) | (86,986) | (86,986) | |||||||||||
Payment of supplementary dividends | (719,903) | (80,000) | (799,903) | (799,903) | |||||||||||
Internal changes in equity: | |||||||||||||||
Proposed minimum mandatory dividends | (502) | 502 | |||||||||||||
Realization of deemed cost, net of taxes | (57,845) | 57,845 | |||||||||||||
Ending balances at Jun. 30, 2022 | 9,269,281 | (33,735) | 15,758 | (817,451) | 812,407 | 235,019 | 1,794,165 | 199,344 | 0 | 0 | 2,048,838 | 10,538,381 | 24,062,007 | 104,681 | 24,166,688 |
Beginning balances at Dec. 31, 2021 | 9,269,281 | (33,735) | 15,455 | (218,265) | 812,909 | 235,019 | 2,513,663 | 279,344 | 0 | 86,889 | 2,114,907 | 0 | 15,075,467 | 99,663 | 15,175,130 |
Transactions with shareholders: | |||||||||||||||
Shares repurchased | (1,904,424) | ||||||||||||||
Ending balances at Dec. 31, 2022 | 9,269,281 | (33,735) | 18,425 | (2,120,324) | 879,278 | 1,404,099 | 19,732,050 | 2,192,442 | 0 | 0 | 1,719,516 | 0 | 33,061,032 | 105,333 | 33,166,365 |
Total comprehensive income | |||||||||||||||
Net income for the period | 10,310,498 | 10,310,498 | 9,918 | 10,320,416 | |||||||||||
Other comprehensive income for the period | (9,740) | (9,740) | (9,740) | ||||||||||||
Transactions with shareholders: | |||||||||||||||
Shares granted | 4,159 | 4,159 | 4,159 | ||||||||||||
Shares repurchased | (778,500) | (778,500) | (778,500) | ||||||||||||
Treasury shares cancelled | 1,517,224 | (1,517,224) | |||||||||||||
Fair value attributable to non-controlling interests | (2,687) | (2,687) | |||||||||||||
Internal changes in equity: | |||||||||||||||
Constitution of reserves | (14,972,324) | 14,972,324 | |||||||||||||
Realization of deemed cost, net of taxes | (59,626) | 59,626 | |||||||||||||
Ending balances at Jun. 30, 2023 | R$ 9,269,281 | R$ (33,735) | R$ 22,584 | R$ (1,381,600) | R$ 879,278 | R$ 1,404,099 | R$ 4,759,726 | R$ 675,218 | R$ 14,972,324 | R$ 0 | R$ 1,650,150 | R$ 10,370,124 | R$ 42,587,449 | R$ 112,564 | R$ 42,700,013 |
COMPANY'S OPERATIONS |
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COMPANY'S OPERATIONS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMPANY'S OPERATIONS | 1.COMPANY’S OPERATIONS Suzano S.A. (“Suzano”) and its subsidiaries (collectively the “Company”) is a public company with its headquarters in Brazil, at Avenida Professor Magalhães Neto, No. 1,752 - 10th floor, rooms 1010 and 1011, Bairro Pituba, in the city of Salvador, State of Bahia, and its main business office in the city of São Paulo. Suzano’s shares are traded on B3 S.A. (“Brasil, Bolsa, Balcão - “B3”), listed in the New Market under the ticker SUZB3, and its American Depositary Receipts (“ADRs”) in a ratio of 1 (one) per common share, Level II, are traded in the New York Stock Exchange (“NYSE”) under the ticker SUZ. The Company has 13 industrial units, located in the cities of Cachoeiro de Itapemirim and Aracruz (Espírito Santo State), Belém (Pará State), Eunápolis and Mucuri (Bahia State), Maracanaú (Ceará State), Imperatriz (Maranhão State), Jacareí, Limeira, Suzano, Rio Verde and Mogi das Cruzes (São Paulo State) and Três Lagoas (Mato Grosso do Sul State). Additionally, it has five technology centers, 23 distribution centers and three ports, all located in Brazil. These units produce hardwood pulp from eucalyptus, coated paper, paperboard, uncoated paper and cut size paper and packages of sanitary paper (consumer goods - tissue) to serve the domestic and foreign markets. Pulp and paper are sold in foreign markets by Suzano, as well as through its wholly-owned subsidiaries and/or its sales offices in Argentina, Austria, China, Ecuador, United States of America, and Singapore. The Company’s operations also include the commercial management of eucalyptus forest for its own use, the operation of port terminals, and the holding of interests, as a partner or shareholder, in other companies or enterprises, and the generation of electricity in the pulp production process and its commercialization. The Company is controlled by Suzano Holding S.A., through a voting agreement whereby it holds 47.12% of the common shares of its share capital. These unaudited condensed consolidated interim financial information was authorized by the Board of Directors on August 1, 2023.
The Company holds equity interests in the following entities:
1.2.Major events in the six-month period ended June 30, 2023 1.2.1.Effects of the war between Russia and Ukraine The Company has continuously monitored the impacts of the current conflict between Russia and Ukraine, both direct and indirect, on society, the economy and markets (global and domestic), with the objective of evaluating possible impacts and risks for the business. The Company’s assessment has covered four main areas:
As a result of the current scenario, the Company has taken steps to expand its monitoring of the situation, together with its main stakeholders, in order to ensure any updates and information flows required for its global decision-making are available in a timely manner. 1.2.2.Cerrado Project On October 28, 2021, the Company’s Board of Directors approved the realization of the Cerrado Project, which consists of building a pulp production mill in the municipality of Ribas do Rio Pardo, in the state of Mato Grosso do Sul. The plant will have an estimated nominal capacity of 2,550,000 tons of eucalyptus pulp production per year, with an estimated period for starting operations in the second semester of 2024. The total investment is R$22,200,000, with payments during the years of 2021 to 2024. 1.2.3.Acquisition of tissue business in Brazil On June 1 2023, the Company acquired the totality of the quotas held by Kimberly-Clark Brasil Indústria e Comércio de Produtos de Higiene Ltda. (“KC Brasil”) in MMC Brasil Indústria e Comércio Ltda (“MMC Brasil”) for the consideration of US$212,029 million (equivalent to R$1,072,657) paid in cash (“Transaction”). MMC Brasil had no operations until the contribution made by KC Brasil as a result of the carve out carried out in May 25, 2023 of the assets related to the business of manufacturing, marketing, distributing and selling of tissue products, including toilet paper, paper towels, napkins, tissues, as well as other paper products in Brazil, including ownership of the brand “NEVE” of KC Brasil. The following table summarizes the allocation of the preliminary purchase price:
(4)Goodwill is attributable to the workforce and expected future profitability of the acquired business. It will be deductible for tax purposes. No deferred tax was recognized on the fair value adjustments as there is an expectation of merging MMC within the fiscal year of 2023. Considering the fact that MMC Brasil was created based on a carve out of a portion of the KC Brasil businesses, counterparty of the transaction, there is no previous history of revenue and/or profits specifically for the acquired entity to be considered or included in a pro forma consolidated revenue and pro forma consolidated profit as if the acquisition had occurred on January 1, 2023. Acquisition related costs of R$12,105 are included in administrative expenses in profit or loss. 1.2.4.Federal Supreme Court (“STF”) decision – Effectiveness of final and unappealable tax decisions On February 8, 2023, the Federal Supreme Court in Brazil concluded the judgments of Items 881 and 885, which discussed the effects of res judicata. Notwithstanding, considering the information available as of the date of these unaudited condensed consolidated interim financial information, the Company is not a party to any litigation related to a tax not being collected due to a past decision considered unappealable, therefore, the Company has no material adjustment due to the decision. 1.2.5.Treasury shares cancelled On February 28, 2023, the Board of Directors decided to cancel 37,145,969 common shares, with an average cost of R$40.84 (forty reais and eighty-four cents) per share, in the amount of R$1,517,224, that were being held in treasury, without changing the share capital and against the balances of available profit reserves. After the cancellation of shares, the share capital of R$9,269,281 is now divided into 1,324,117,615 common shares, all nominative, book-entry and without par value. 1.2.6.Biomas On September 5, 2022, Biomas Serviços Ambientais, Restauração e Carbono Ltda. (“Biomas”) was initially established by Suzano S.A. On November 12, 2022, Suzano in partnership with Itaú Unibanco S.A, Marfrig Global Foods S.A., Rabobank Foundational Investments B.B., Santander Corretora de Seguros, Investimentos e Serviços S.A. and Vale S.A., announced an alliance during an event held at the Climate Conference, COP27, in Egypt, for the creation of a company focused entirely to forest restoration, conservation and preservation activities in Brazil. After the transformation of Biomas into a joint venture, Suzano, together with Marfrig, Rabobank and Vale, made a commitment to invest R$20,000 each partner, in accordance to the terms of the respective investment agreements on February 27, 2023, once the conditions precedent and closing acts established in said agreements were fulfilled. Itaú and Santander made their respective capital contributions on March 21, 2023. For the period ended June 30, 2023, the amount of R$30,000 (R$5,000 for each partner) was fully paid with a remaining balance of R$90,000 (R$15,000 for each partner) to be paid. With the completion of the above investments, each company now holds 16.66% of equity interest at Biomas. |
BASIS OF PREPARATION AND PRESENTATION OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION |
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BASIS OF PREPARATION AND PRESENTATION OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION | ||||||||||||
BASIS OF PREPARATION AND PRESENTATION OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION |
The Company’s unaudited condensed consolidated interim financial information, of the six-month period ended June 30, 2023, are prepared in compliance with the international standard IAS 34 Interim Financial Reporting issued by the International Accounting Standards Board (“IASB”) and disclose all the applicable significant information related to the financial information, which is consistent with the information used by Management in the performance of its duties. The Company’s unaudited condensed consolidated interim financial information are expressed in thousands of Brazilian Reais (“R$”), as well as the amounts of other currencies, when applicable, were also expressed in thousands, unless otherwise stated. The preparation of unaudited condensed consolidated interim financial information requires Management to make judgments, use estimates and adopt policies in the process of applying accounting practices that affect the disclosed amounts of revenues, expenses, assets and liabilities, including the disclosure of contingent liabilities assumed. However, the uncertainty inherent to these judgements, assumptions and estimates could result in material adjustments to the carrying amount of certain assets and liabilities in future periods. The Company reviews its judgments, estimates and assumptions continually as disclosed in the annual financial statements for the year ended December 31, 2022 (Note 3.2.34). There were no changes in these judgments, estimates and assumptions compared to disclosed on December 31, 2022. The unaudited condensed consolidated interim financial information prepared on historical cost basis, except for the following material items recognized:
The unaudited condensed consolidated interim financial information was prepared under the going concern assumption. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The unaudited condensed consolidated interim financial information was prepared based on the information of Suzano and its subsidiaries on the same base date, except for subsidiary MMC Brasil and associates Ensyn and Spinnova, as well as in accordance with consistent accounting policies and practices. The unaudited condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended December 31, 2022, considering that its purpose is to provide an update on the activities, events and significant circumstances in relation to those disclosed in the consolidated financial statements. Therefore, unaudited condensed consolidated interim financial information focus on new activities, events and circumstances and do not duplicate the information previously disclosed, except when Management judges that the maintenance of the information is relevant. The accounting policies have been consistently applied to all consolidated companies. There were no changes on such policies and estimates calculation methodologies, except for the application of the new accounting policies as of January 1, 2023 and whose estimated impact was disclosed in the annual financial statements of December 31, 2022, as disclosed in the Note 3.1. 3.1.New accounting policies and changes in accounting policies adopted The new standards and interpretations issued, until the issuance of the Company’s unaudited condensed consolidated interim financial information, are described below. 3.1.1.Accounting policies adopted
The amendments to IAS 1 affect only the presentation of liabilities as current or non-current in the balance sheet, and not the amount or the timing of the recognition of any asset, liability, income or expense, or the information disclosed about these items. The amendments clarify that the classification of liabilities as current or non-current is based on the rights existing at the balance sheet date, specify that the classification is not affected by expectations about whether an entity will exercise its right to postpone the settlement of the liability, explain that the rights exist if restrictive clauses are complied with at the balance sheet date, and introduce the definition of ‘settlement’ to clarify that it refers to a transfer to a counterparty of an amount in cash, equity instruments, other assets or services. The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments change the requirements in IAS 1 with regard to the disclosure of accounting policies. The amendments replace all instances of the term ‘significant accounting policies’ with ‘material accounting policy information’. Accounting policy information is material if, considered together with other information included in an entity’s financial statements, it can reasonably be expected to influence the decisions that the primary users of the financial statements make on the basis of those financial statements. The supporting paragraphs in IAS 1 are also amended to clarify that accounting policy information that relates to immaterial transactions, other events or conditions is immaterial, and need not be disclosed. Accounting policy information may be material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial. However, not all accounting policy information relating to material transactions, other events or conditions is itself material. The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments replace the definition of a change in accounting estimates with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. The definition of a change in accounting estimates was deleted. However, the Board retained the concept of changes in accounting estimates in the Standard through the following clarifications:
The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments introduce a further exception to the initial recognition exemption. Under the amendments, an entity may not apply the initial recognition exemption for transactions that give rise to equal taxable and deductible temporary differences. Depending on the applicable tax law, equal taxable and deductible temporary differences may arise from the initial recognition of an asset and liability in a transaction that is not a business combination and affects neither the accounting nor the taxable profit. For example, this may arise upon the recognition of a lease liability and the corresponding right-of-use asset, applying IFRS 16 at the commencement date of a lease. Following the amendments to IAS 12, an entity is required to recognise the related deferred tax asset and liability, with the recognition of any deferred tax asset being subject to the recoverability criteria in IAS 12. The amendments apply to transactions that occur on or after the beginning of the earliest comparative period presented. In addition, at the beginning of the earliest comparative period, an entity recognises:
The Company assessed the content of this pronouncement and did not identify any impacts. |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT |
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FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | 4.FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT 4.1.Financial risks management 4.1.1.Overview In the six-month period ended June 30, 2023, there were no significant changes in the financial risk management policies and procedures compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4). The Company maintained its conservative approach and strong cash and marketable securities position, as well as its hedging policy. 4.1.2.Classification All transactions with financial instruments are recognized for accounting purposes and classified in the following categories:
1)Does not include items not classified as financial instruments. 4.1.3.Fair value of loans and financing The estimated fair values of loans and financing are set forth below:
The book values of loans and financing are disclosed in Note 18. Management considers that, for its other financial liabilities measured at amortized cost, their book values approximate their fair values, and therefore the fair value information is not being presented. 4.2.Liquidity risk management The Company’s purpose is to maintain a strong cash and marketable securities position to meet its financial and operating commitments. The amount held in cash is intended to cover the expected outflows in the normal course of its operations, while the cash surplus is generally invested in highly liquid financial investments according to the Cash Management Policy. The cash position is monitored by the Company’s Management, by means of management reports and participation in performance meetings with determined frequencies. During the six-month period ended June 30, 2023, the variations in cash and marketable securities were as expected, and the cash generated from operations was mostly used for investments and debt service. All derivative financial instruments were traded over the counter and do not require deposit guarantee margins. The remaining contractual maturities of financial liabilities are presented as of the balance sheet date. The amounts as set forth below consist of undiscounted cash flow, and include interest payments and exchange rate variations, and therefore may not reconcile with the amounts disclosed in the balance sheet.
4.3. Credit risk management In the six-month period ended June 30, 2023, there were no significant changes in the credit risk management policies compared to those disclosed in the annual financial statements for the year ended of December 31, 2022 (Note 4). 4.4.Market risk management In the six-month period ended June 30, 2023, there were no significant changes in the market risk management policies and procedures compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4). 4.4.1.Exchange rate risk management As disclosed in the financial statements for the year ended December 31, 2022 (Note 4), the Company enters into U.S.Dollar selling transactions in the futures markets, including strategies involving options, to ensure attractive levels of operating margins for a portion of revenue. Such transactions are limited to a percentage of the net surplus foreign currency over a ’ time horizon and therefore, are matched to the availability of currency for sale in the short term. The Company’s Board of Directors approved the contracting of extraordinary hedge, in addition to the strategy mentioned above, for investments in the Cerrado Project, with a term of up to 36 months as of November 2021, in an amount of up to US$1,000,000. On July 27, 2022, the Board of Directors approved the expansion of the program, increasing the maximum amount (notional) to US$1,500,000, maintaining the previously established deadline. In order to provide transparency on the hedge program for the Cerrado Project, since December 31, 2021 the Company has started to prominently disclose the respective contracted operations. The assets and liabilities that are exposed to foreign currency, substantially in U.S. Dollars, are set forth below:
4.4.1.1.Sensitivity analysis – foreign exchange rate exposure – except for derivative financial instruments For market risk analysis, the Company uses scenarios to evaluate both its asset and liability positions in foreign currency, and the possible effects on its results. The probable scenario represents the amounts recognized, as they reflect the conversion into Brazilian Reais on the balance sheet date (R$ to U.S.$ = R$4.8192). This analysis assumes that all other variables, particularly interest rates, remain constant. The other scenarios considered the depreciation of the Brazilian Real against the U.S. Dollar at the rates of 25% and 50% before taxes. The following table set forth the potential impacts at their absolute amounts:
4.4.1.2.Sensitivity analysis – foreign exchange rate exposure – derivative financial instruments The Company has sales operations in US$ in the futures markets, including strategies using options, to ensure attractive levels of operating margins for a portion of its revenue. These operations are limited to a percentage of the total exposure to US$ over a 24-month horizon, or to investments in the Cerrado Project, according to the extraordinary hedge described above, and are therefore pegged to the availability of ready-to-sell foreign exchange in the short term. In addition to the transaction described above, the Company also taken out derivative instruments linked to the US$ and subject to exchange fluctuations, seeking to adjust the debt’s currency indexation to the cash generation currency, as provided for in its financial policies. For the calculation of the mark-to-market (“MtM”) price, the exchange rate of the last business day of the period is used. These market movements caused a positive impact on the mark-to-market position entered into by the Company. This analysis below assumes that all other variables, particularly the interest rates, remain constant. The other scenarios considered the depreciation of the Brazilian Real against the US$ by 25% and 50%, before taxes, based on the base scenario on June 30, 2023. The following table set out the possible impacts assuming these scenarios:
(1)Long positions at US$/EUR parity in order to protect the Capex cash flow of the Cerrado Project against the appreciation of the Euro. 4.4.2.Interest rate risk management Fluctuations in interest rates could increase or reduce the costs of new loans and existing contracted operations. The Company is constantly looking for alternatives for the use of financial instruments in order to avoid negative impacts on its cash flow. Considering that on March 5, 2021, the Financial Conduct Authority (“FCA”) announced the discontinuation date of the 3-month LIBOR as June 30, 2023, the Company initiated negotiations of the terms for swapping the indexers of its debt contracts and related derivatives upon this announcement. As of June 30, 2023, the Company had R$15,566 related to loan and financing contracts, and R$15,151 related to derivative contracts, and it conducted the contract amendment process with the counterparties of each contract to ensure that the terms and market best practices were adopted at the time of the index transition starting from June 2023. On July 1, 2023, the contracts will be indexed to SOFR, which has been adopted as the new reference interest rate by the capital market. This negotiation will not have a substantial impact on the balances presented in the loan and financing and derivative instrument categories. The Company understands that it will not be necessary to change the risk management strategy due to the change of indexation of its financial contracts linked to LIBOR. 4.4.2.1.Sensitivity analysis – exposure to interest rates – except for derivative financial instruments For its market risk analysis, the Company uses scenarios to evaluate the sensitivity of changes in operations impacted by the following rates: Interbank Deposit Rate (“CDI”), Long Term Interest Rate (“TJLP”), Special System for Settlement and Custody (“SELIC”) and the London Interbank Offered Rate (“LIBOR”), which could impact the results. The probable scenario represents the amounts already booked, as they reflect Management’s best estimates. This analysis assumes that all other variables, particularly exchange rates, will remain constant. The other scenarios considered a depreciation of 25% and 50% in market interest rates. The following table set forth the possible impacts assuming these scenarios in absolute amounts:
4.4.2.2.Sensitivity analysis – exposure to interest rates – derivative financial instruments This analysis assumes that all other variables remain constant. The other scenarios considered a depreciation of 25% and 50% in market interest rates. The following table sets out the possible impacts of these assumed scenarios:
4.4.2.3.Sensitivity analysis to changes in the consumer price indices of the US economy For the measurement of the probable scenario, the United States Consumer Price Index (“US-CPI”) was considered on June 30, 2023. The probable scenario was extrapolated considering a depreciation of 25% and 50% in the US-CPI to define the possible and remote scenarios, respectively. The following table sets out the possible impacts, assuming these scenarios in absolute amounts:
4.4.3.Commodity price risk management The Company is exposed to commodity prices, mainly in the selling price of pulp in the international market. The dynamics of rising and falling production capacities in the global market and macroeconomic conditions may impact the Company´s operating results. Through a specialized team, the Company monitors hardwood pulp prices and analyses future trends, adjusting the forecasts aimed at assisting with preventive measures to calculate the different scenarios. There is no sufficiently liquid financial market to mitigate the risk of a material portion of the Company’s operations. Hardwood pulp price protection instruments available on the market have low liquidity and low volume, and high levels of distortion in price formation. The Company is also exposed to international oil prices, reflected in logistical costs for selling in the export market, and indirectly in the costs of other supply, logistics and service contracts. In such cases, the Company evaluates whether to contract derivative financial instruments to mitigate the risk of price variations in its results. 4.5.Derivative financial instruments The Company determines the fair value of derivative contracts, which differ from the amounts realized in the event of early settlement due to bank spreads and market factors at the time of quotation. The amounts presented by the Company are based on an estimate using market factors and use data provided by third parties, measured internally and compared to calculations performed by external consultants and by counterparties. Details of derivative financial instruments and their respective calculation methodologies are disclosed in the annual financial statements for the year ended December 31, 2022 (Note 4). 4.5.1.Outstanding derivatives by type of contract, including embedded derivatives The positions of outstanding derivatives are set forth below:
The current contracts and the respective protected risks are set forth below:
The variation in the fair values of derivatives on June 30, 2023 compared to the fair values measured on December 31, 2022 are explained substantially by the appreciation of the Brazilian Real against the US Dollar and by settlements during the period. There were also impacts caused by the variations in the Pre, Foreign Exchange Coupon and LIBOR curves in the operations. It is important to highlight that the outstanding agreements on June 30, 2023 are over-the-counter market operations, without any type of collateral margin or forced early settlement clause due to variations from market marking. 4.5.2.Fair value by maturity schedule
4.5.3.Outstanding assets and liabilities derivatives positions The outstanding derivatives positions are set forth below:
4.5.4.Fair value settled amounts The settled derivatives positions are set forth below:
4.6.Fair value hierarchy Financial instruments are measured at fair value, which considers the fair value as the price that would be received from selling an asset or paid to transfer a liability in an unforced transaction between market participants at the measurement date. For the six-month period ended June 30, 2023, there were no changes between the 3 (three) levels of hierarchy and no transfers between levels 1, 2 and 3.
4.7.Climate change In the annual financial statements for the year ended December 31, 2022, the risks and opportunities information linked to climate change and the sustainability strategy were disclosed, which did not change significant during the six-month period ended June 30, 2023, except for the items presented in Note 4.7.1. 4.7.1.Opportunities linked to climate change and the sustainability strategy 4.7.1.1Biomas As disclosed in Note 1.2.6, Suzano and five other global companies created Biomas with objective of restoring, conserving and preserving native forests in Brazil. The initiative aims to restore and protect, over a period of 20 years, native forest in some of Brazil´s most valuable ecosystems, such as the Amazon, Atlantic Forest and Cerrado biomes – The area is equivalent to the territory of Switzerland or the state of Rio de Janeiro, in Brazil. The initiative aims to promote a sustainable business model from a financial perspective, enabling each restoration, conservation, and preservation projects to be viable through the commercialization of carbon credits, as removals and avoided emissions, reducing tons of CO2e from the atmosphere. The first stage will involve the identification and prospecting of areas, promoting nurseries for the large-scale production of native trees, engaging local communities in Biomas activities, discussing the application of the project in public areas, partnering with carbon certification platforms and implementing pilot projects. 4.7.1.2Generation of carbon credits The Company has ongoing carbon credit projects certifications, including:
The carbon credits are registered by Verra, an accredited company that holds a global platform, which is also responsible for the custody of the credits. This company has developed the Verified Carbon Standard (VCS) program, currently regarded as the global reference standard, in the best understanding of the company. 4.7.1.3Production of wood-based textile fiber In May 2023, Woodspin, located in Finland, inaugurated the first factory producing sustainable, recyclable and fully biodegradable textile fiber from responsibly grown wood, the result of the joint venture between Spinnova and Suzano. This new type of “green fabric” has the potential to replace less sustainable materials used in many products. This unit will be used for market development and technology improvement. For the construction and operation of textile fiber projects, Woodspin uses Suzano’s microfibrillated cellulose (MFC) as raw material. 4.8.Capital management The main objective is to strengthen the Company’s capital structure, aiming to maintain an appropriate level of financial leverage while mitigating risks that could affect the availability of capital for business development. The Company continuously monitors significant indicators, such as consolidated financial leverage, which is the ratio of total net debt to adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (“Adjusted EBITDA”). |
CASH AND CASH EQUIVALENTS |
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CASH AND CASH EQUIVALENTS | 5.CASH AND CASH EQUIVALENTS
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MARKETABLE SECURITIES |
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MARKETABLE SECURITIES | 6.MARKETABLE SECURITIES
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TRADE ACCOUNTS RECEIVABLE |
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TRADE ACCOUNTS RECEIVABLE | 7.TRADE ACCOUNTS RECEIVABLE 7.1.Breakdown of balances
(1)The balance refers to transactions with Ibema Companhia Brasileira de Papel. The Company carries out factoring transactions for certain customer receivables where transfers the control and all risks and rewards related to these receivables to the counterparty, so these receivables are derecognized from accounts receivable in the balance sheet. This transaction refers to an additional cash generation opportunity and is therefore classified as a financial asset measured at amortized cost. The impact of these factoring transactions on the accounts receivable as of June 30, 2023, was R$4,227,031 (R$6,889,492 as of December 31, 2022). 7.2.Breakdown of trade accounts receivable by maturity
7.3.Roll-forward of expected credit losses
The Company maintains guarantees for overdue receivables as part of its commercial operations, through credit insurance policies, letters of credit and other guarantees. These guarantees avoid the need to recognize expected credit losses, in accordance with the Company’s credit policy. 7.4.Main customers The Company has 1 (one) customer responsible for 12.37% of the net sales of pulp segment on June 30, 2023 (10.67% on December 31, 2022) and no main customer responsible for more than 10% of the net sales of paper segment on June 30, 2023 and December 31, 2022. |
INVENTORIES |
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INVENTORIES | 8.INVENTORIES
Inventories are disclosed net of estimated losses. 8.1.Roll-forward of estimated losses
On June 30, 2023 and December 31, 2022, there were no inventory items pledged as collateral. |
RECOVERABLE TAXES |
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RECOVERABLE TAXES | 9.RECOVERABLE TAXES
9.1.Roll-forward of provision for loss
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ADVANCES TO SUPPLIERS | 10.ADVANCES TO SUPPLIERS
In the annual financial statements for the year ended December 31, 2022, the characteristics of the advances were disclosed, which did not change during the six-month period ended June 30, 2023. |
RELATED PARTIES |
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RELATED PARTIES | 11.RELATED PARTIES The Company’s commercial and financial transactions with the controlling shareholder and Companies owned by the controlling shareholder Suzano Holding S.A. (“Suzano Group”) were carried out at specific prices and conditions, as well as the corporate governance practices adopted by the Company, and those recommended and/or required by the applicable legislation. The transactions refers mainly to: Assets: (i) accounts receivable from the sale of pulp, paper, tissue and other products; (ii) dividends receivable; (iii) reimbursement for expenses; and (iv) social services; Liabilities: (i) loan agreements;(ii) reimbursement for expenses; (iii) social services; (iv) real estate consulting; and (v) dividends payable. Amounts in the statements of income: (i) sale of pulp, paper, tissue and other products; (ii) loan charges and exchange variation; (iii) social services and (viii) real estate consulting. For the six-month period ended June 30, 2023, there were no material changes in the terms of the agreements, deals and transactions entered into, nor were there any new contracts, agreements or transactions of any different nature entered into between the Company and its related parties. 11.1.Balances recognized in assets and liabilities and amounts of transactions during the period
1) Refers mainly to the sale of pulp. 11.2.Management compensation Expenses related to the compensation of key management personnel, which include the Board of Directors, Fiscal Council and Board of Statutory Executive Officers, recognized in the statement of income for the period, are set out below:
Short-term benefits include fixed compensation (salaries and fees, vacation pay, mandatory bonus and “13th month’s salary” bonus), payroll charges (Company’s share of contributions to social security – “INSS”) and variable compensation such as profit sharing, bonuses and benefits (company car, health plan, meal voucher, market voucher, life insurance and private pension plan). Long-term benefits include the stock option plan and phantom shares for executives and key members of Management, in accordance with the specific regulations disclosed in Note 22. |
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INCOME AND SOCIAL CONTRIBUTION TAXES | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME AND SOCIAL CONTRIBUTION TAXES | 12.INCOME AND SOCIAL CONTRIBUTION TAXES 12.1.Deferred taxes The Company calculates income tax and social contribution taxes, current and deferred, based on the following rates: (i) 15% plus an additional 10% on taxable income in excess of R$240 for IRPJ; and (ii) 9% for CSLL, on the net income. Balances are recognized in the Company’s income on an accruals basis. Subsidiaries domiciled in Brazil have their taxes calculated and provisioned in accordance with the current legislation and their specific tax regime, including, in some cases, the presumed profit method. Subsidiaries domiciled abroad are subject to taxation in their respective jurisdictions, according to local regulations. Deferred income and social contribution taxes are recognized at the net amounts in non-current assets or liabilities. In Brazil, Law nº. 12,973/14 revoked article 74 of Provisional Measure nº. 2,158/01 and determines that the parcel of the adjustment of the value of the investment in subsidiaries, direct and indirect, domiciled abroad, equivalent to the profit earned by them before income tax, except for exchange rate variation, must be added in the determination of taxable income and the social contribution calculation basis of the controlling entity domiciled in Brazil, at each year ended. The Company management believes in the validity of the provisions of international treaties entered by Brazil to avoid double taxation. In order to ensure its right to non-double taxation, the Company filed a lawsuit in April 2019, which aims to exempt the double taxation in Brazil, of profits earned by its subsidiary located in Austria, according to Law No. 12,973/14. Due to the preliminary injunction granted in favor of the Company in the aforementioned lawsuit, the Company decided not to add the profit from Suzano International Trading GmbH, located in Austria, when determining its taxable income and social contribution basis of the net profit of the Company for the six-month period ended June 30, 2023. There is no provision for tax related to the non-double taxation profits of such subsidiary in 2022. 12.1.1.Deferred income and social contribution taxes
1)Accelerated tax depreciation is taken as a benefit only in the income tax calculation bases. 12.1.2.Breakdown of accumulated tax losses and social contribution tax losses carried forward
12.1.3.Roll-forward of deferred tax assets
12.2.Reconciliation of the effects of income tax and social contribution on profit or loss
12.3.Tax incentives The Company benefits from a tax incentive for partial reduction of the income tax obtained from operations carried out in areas under the jurisdiction of the Northeast Development Superintendence (“SUDENE”) and the Superintendence of Amazon Development (“SUDAM”). The IRPJ reduction incentive is calculated based on the activity profits (exploitation profits) and considers the allocation of the operating profit based on the incentive production levels for each product.
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BIOLOGICAL ASSETS |
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BIOLOGICAL ASSETS | 13.BIOLOGICAL ASSETS The roll-forward of biological assets is as set forth below:
The calculation of fair value of the biological assets falls under Level 3 in the hierarchy set forth in IFRS 13 — Measurement of Fair Value, due to the complexity and structure of the calculation. The assumptions such as the average annual growth (“IMA”), discount rate, and average gross selling price of eucalyptus, stand out as being the most sensitive, where increases or reductions in these assumptions could generate significant gains or losses in the measurement of fair value. The assumptions used in the measurement of the fair value of biological assets were as follow:
The table below discloses the measurement of the premises adopted:
The pricing model considers the net cash flows, after the deduction of taxes on profit at the applicable rates. The fair value adjustment justified by the combined variations of the indicators mentioned above resulted in a positive variation of R$1,256,315 recognized in other operating income (expenses), net (Note 30).
The Company manages the financial and climate risks related to its agricultural activities in a preventive manner. To reduce the risks arising from edaphoclimatic factors, the weather is monitored through meteorological stations and, in the event of pests and diseases, our Department of Forestry Research and Development, an area specialized in physiological and phytosanitary aspects, has procedures to diagnose and act rapidly against possible occurrences and losses. The Company has no biological assets pledged for the six-month period ended June 30, 2023 and the year ended December 31, 2022. |
INVESTMENTS |
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INVESTMENTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS | 14.INVESTMENTS 14.1.Investments breakdown
14.2.Investments in associates and joint ventures
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PROPERTY, PLANT AND EQUIPMENT |
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PROPERTY, PLANT AND EQUIPMENT | 15.PROPERTY, PLANT AND EQUIPMENT
On June 30, 2023, the Company evaluated the business, market and climate impacts, and did not identify any event that indicated the need to perform an impairment test and to record any impairment provision for property, plant and equipment. 15.1.Items pledged as collateral On June 30, 2023, property, plant and equipment items pledged as collateral for loan transactions and legal proceedings, consisting mainly of the units of Suzano and Três Lagoas totalling R$12,856,211 (R$12,773,662 in the same units as at December 31, 2022). 15.2.Capitalized expenses For the six-month period ended June 30, 2023, the Company capitalized loan costs in the amount of R$511,650 (R$359,407 as of December 31, 2022). The weighted average interest rate, adjusted by the equalization of the exchange rate effects, utilized to determine the capitalized amount was 11.78% p.a. (12.49% p.a. as of December 31, 2022). |
INTANGIBLE |
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INTANGIBLE | 16.INTANGIBLE 16.1.Goodwill and intangible assets with indefinite useful lives
1)Refers to the goodwill of the MMC Brasil business combination, whose allocation of the purchase price is disclosed in note 1.2.3. 2)Refers to other intangible assets with indefinite useful lives such as servitude of passage and electricity. The goodwill is based on expected future profitability supported by valuation reports, after the purchase price allocation. Goodwill is allocated to cash-generating units as presented in Note 28.4. For the six-month period ended June 30, 2023, the Company did not identify any event that indicated the need to perform the impairment test and to record any impairment provision for intangible assets. 16.2.Intangible assets with limited useful lives
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil Indústria e Comércio Ltda.(Note 1.2.3.) |
TRADE ACCOUNTS PAYABLE |
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TRADE ACCOUNTS PAYABLE | 17.TRADE ACCOUNTS PAYABLE
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LOANS, FINANCING AND DEBENTURES |
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LOANS, FINANCING AND DEBENTURES | 18.LOANS, FINANCING AND DEBENTURES 18.1.Breakdown by type
18.2.Breakdown by maturity – non - current
18.3.Roll-forward of loans, financing and debentures
18.4.Breakdown by currency
18.5.Fundraising costs The fundraising costs are amortized based on the terms of agreements and the effective interest rate.
18.6.Guarantees Some loan and financing agreements have guarantees clauses, in which the financed equipment or other property, plant and equipment are offered as collateral by the Company, as disclosed in Note 15.1. The Company does not have contracts with restrictive financial clauses (financial covenants) which must be complied with. 18.7.Relevant transactions entered into during the period 18.7.1.BNDES On June 27, 2023, the Company raised R$500,000 from BNDES indexed to the Long-Term Rate (“TLP”), plus a fixed interest rate of 5.23% p.a., with a principal grace period of (seven) years and maturity in December 2037. The funds were allocated to projects in the forestry sector. 18.7.2.International Finance Corporation (“IFC”) On December 22, 2022, the Company obtained a new credit line (“A&B Loan”) to be financed by the International Finance Corporation (IFC) and a syndicate of commercial banks, in a total amount of US$600,000 (equivalent to R$2,891,520). The financing consists of the following parts: (i) “A-loan” in the amount of US$250,000 (equivalent to R$1,204,800) with IFC’s own resources, at a cost of Term SOFR + 1.80% p.a. and a total term of eight years, with a principal grace period of six years; and (ii) “B-loan,” a syndicated loan in the amount of US$350,000 (equivalent to R$1,686,720) at a cost of Term SOFR + 1.60% p.a. and a total term of seven years, with a principal grace period of five years. This credit line was fully utilized by June 30, 2023. The credit operation has sustainability performance indicators (KPIs) associated with goals for: (a) reducing greenhouse gas (GHG) emissions intensity, and (b) increasing the representation of women in leadership positions within the Company. The funds will be allocated to the Cerrado Project. 18.7.3.Advance of exchange contract (“ACC”) On May 19, 2023, the Company raised US$100,000 (equivalent to R$481,920) from BNP Paribas at a fixed rate of 6.00%, with maturity in May 2024. On June 21, 2023, the Company raised US$35,000 (equivalent to R$168,672) from BNP Paribas at a fixed rate of 6.52%, with maturity in June 2024. 18.7.4.Debenture On June 29, 2023, the Company issued debenture in the amount of R$1,000,000. The debenture consists of two parts: (i) an amount of R$500,000 at a cost of IPCA + 6.0188% p.a. and a total term of seven years, with a single maturity in 2030; and (ii) an amount of R$500,000 at a cost of IPCA + 6.2477% p.a. and a total term of ten years, with a single maturity in 2033. 18.8.Significant transactions settled during the period On June 22, 2023, the Company settled a CRA contract in the amount of R$685,239 (principal and interest), with an original maturity in June 2023 and a cost of IPCA + 5.9844%. |
LEASES |
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LEASES | 19.LEASES 19.1.Right of use The balances rolled forward are set out below:
For the six-month period ended June 30, 2023, the Company does not have commitments to lease agreements not yet in force. 19.2.Lease liabilities The balance of lease payables on June 30, 2023, measured at present value and discounted at the respective discount rates are set forth below:
The balances rolled forward are set out below:
The maturity schedule for future payments not discounted to present value related to lease liabilities is disclosed in Note 4.2. 19.2.1.Amounts recognized in the statement of income for the period The amounts recognized are set out below:
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PROVISION FOR JUDICIAL LIABILITIES |
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PROVISION FOR JUDICIAL LIABILITIES | 20.PROVISION FOR JUDICIAL LIABILITIES The Company is involved in certain legal proceedings arising in the normal course of its business, which include tax, social security, labor, civil, environment and real estate. The Company classifies the risk of unfavorable decisions in legal proceedings, based on legal advice, which reflects the estimated probable losses. The Company’s Management believes that, based on the available information as of the date of these unaudited condensed consolidated interim financial information, its provisions for tax, social security, labor, civil, environment and real estate risks, accounted for according to IAS 37 are sufficient to cover estimated losses related to its legal proceedings, as set forth below: 20.1.Roll-forward and changes in the provisions for probable losses based on the nature of the proceedings, net of judicial deposits
2)Reversal due to a change in likelihood and/or due to settlement. 20.1.1.Tax and social security On June 30, 2023, the Company has 30 (thirty) (31 (thirty-one) as of December 31, 2022) administrative and judicial proceedings of a tax or social security nature in which the disputed matters are related to IRPJ, CSLL, PIS, COFINS, ICMS among others, whose amounts are provisioned when the likelihood of loss is deemed probable by the Company’s external legal counsel and by Management. 20.1.2.Labor On June 30, 2023, the Company has 1,176 (one thousand, one hundred and seventy-six) as of December 31, 2022 labor lawsuits. In general, the provisioned labor proceedings are related primarily to matters frequently contested by employees of agribusiness companies, such as wages and/or severance payments, in addition to suits filed by outsourced employees of the Company. 20.1.3.Civil, environment and real estate On June 30, 2023, the Company has 77 (seventy-seven) (66 (sixty-six) as at December 31, 2022) civil, environmental and real estate proceedings. The provisioned Civil, environment and real estate proceedings are related primarily to the payment of damages, including those arising from contractual obligations, traffic-related injuries, possessory actions, environmental restoration obligations, claims and others. 20.2.Contingencies with possible losses The Company is involved in tax, civil and labor lawsuits, whose losses have been assessed as possible by Management, supported by legal counsel, and therefore no provision was recorded:
In the six-month period ended June 30, 2023, there were no significant changes in the main nature of these contingencies compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 20). 20.3.Contingent assets In the six-month period ended June 30, 2023, there were no significant changes in the main nature of these contingencies compared to those disclosed in the annual financial statements for the year ended December 31, 2022 (Note 20). |
EMPLOYEE BENEFIT PLANS |
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EMPLOYEE BENEFIT PLANS | 21.EMPLOYEE BENEFIT PLANS The Company provides supplementary pension plan and defined benefit plan, such as medical assistance and life insurance. The characteristics of such benefits were disclosed in the annual financial statements for the year ended December 31, 2022 (Note 21), which did not change during the six-month period ended June 30, 2023. 21.1.Pension plan Contributions made by the Company, for Suzano Prev pension plan managed by Brasilprev Seguros e Previdência S.A., for the six-month period ended June 30, 2023 amounted R$8,650 (R$7,308 as of June 30, 2022) recognized under the cost of sales, selling and general and administrative expenses. 21.2.Defined benefits plan The Company offers the following post-employment benefits in addition to the pension plans, which are measured based on actuarial calculations and recognized in the unaudited condensed consolidated interim financial information. The roll-forward of actuarial liabilities prepared based on actuarial report is set forth below:
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SHARE-BASED COMPENSATION PLAN |
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SHARE-BASED COMPENSATION PLAN | 22.SHARE-BASED COMPENSATION PLAN For the six-month period ended June 30, 2023, the Company has 3 (three) share-based, long-term compensation plans: (i) Phantom stock option plan (“PS”); (ii) Share Appreciation Rights (“SAR”), both settled in local currency; and (iii) restricted shares, settled in shares. The characteristics and measurement method of each plan were disclosed in the annual financial statements for the year ended December 31, 2022 (Note 22), which did not change during the six-month period ended June 30, 2023. 22.1.Long term compensation plans (“PS and SAR”) The roll-forward arrangements are set out below:
22.2.Restricted shares plan The position is set forth below:
22.3.Measurement assumptions The amounts corresponding to the services received and recognized are set forth below:
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LIABILITIES FOR ASSETS ACQUISITIONS AND SUBSIDIARIES |
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LIABILITIES FOR ASSETS ACQUISITIONS AND SUBSIDIARIES | 23.LIABILITIES FOR ASSETS ACQUISITIONS AND SUBSIDIARIES
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SHAREHOLDERS' EQUITY |
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SHAREHOLDERS' EQUITY | 24.SHAREHOLDERS’ EQUITY 24.1Share capital On June 30, 2023, Suzano’s share capital was R$9,269,281 divided into 1,324,117,615 common shares, all nominative, book-entry shares without par value. Expenses related to the public offering were R$33,735, totaling a net share capital of R$9,235,546. The breakdown of the share capital is as set out below:
By a resolution of the Board of Directors, the share capital may be increased, irrespective of any amendments to the Bylaws, up to the limit of 780,119,712 common shares, all exclusively book-entry shares. For the six-month period ended June 30, 2023, SUZB3 common shares closed the period quoted at R$44.22 (forty-four reais and twenty-two cents) and R$48.24 (forty-eight reais and twenty-four cents) on December 31, 2022. 24.2Treasury shares In the six-month period ended June 30, 2023, the Company had 32,466,900 (51,911,569 as of December 31, 2022) of its own common shares held in treasury, with an average cost of R$42.55 (forty-two reais and fifty-five cents) per share, with a historical value of R$1,381,600 (R$2,120,324 as at December 31, 2022) and the market corresponding to R$1,435,686 ( R$2,504,214 as at December 31, 2022). On February 28, 2023, 37,145,969 common shares were cancelled, as described in Note 1.2.5. The Company has repurchase programs, approved on October 27, 2022, with a limit of 20,000,000 common shares of its own issue, with a term of 18 months. Up to June 30, 2023, the Company had repurchased 17,701,300 common shares with a total of R$778,500, of which R$721,052 had a cash effect up to June 30, 2023 and R$57,448 were settled in the subsequent month.
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EARNINGS (LOSS) PER SHARE |
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EARNINGS (LOSS) PER SHARE | 25.EARNINGS (LOSS) PER SHARE 25.1Basic The basic earnings (loss) per share is measured by dividing the profit attributable to the Company’s shareholders by the weighted average number of common shares issued during the period, excluding the common shares acquired by the Company and held as treasury shares.
25.2Diluted The diluted earnings (loss) per share is measured by adjusting the weighted average of outstanding common shares, assuming the conversion of all common shares with dilutive effects.
25.3Profit reserves Reserves are constituted by the allocation of the Company’s profits, after the allocation for the payment of the minimum mandatory dividends and after the allocation to the various profit reserves. In April 26, 2023, the shareholders’ meeting approved the retention of profits in the amount of R$14,972,324, for investments on the Company’s productive capacity and improvement of processes in order to meet the Company’s growth strategy commitments. |
NET FINANCIAL RESULT |
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NET FINANCIAL RESULT | 26.NET FINANCIAL RESULT
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NET SALES | 27.NET SALES
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SEGMENT INFORMATION |
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SEGMENT INFORMATION | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | 28.SEGMENT INFORMATION 28.1Criteria for identifying operating segments The Board of Directors and Board of Statutory Executive Officers evaluates the performance of the Company’s business segments through EBITDA.The operating segments defined by the Company’s management are set forth below:
Information related to total assets by reportable segment is not disclosed, as it is not included in the set of information made available to the Company’s management, which makes investment decisions and determines the allocation of resources on a consolidated basis. In addition, with respect to geographical information related to non-current assets, the Company does not disclose such information, as all property, plant and equipment, biological and intangible assets are in Brazil. 28.2Information of operating segments
28.3Net sales by product
28.4Goodwill based on expected future profitability The goodwill based on expected future profitability arising from the business combination was allocated to the disclosable segments, which correspond to the Company’s cash-generating units (“CGUs”), considering the economic benefits generated by such intangible assets. The allocation of goodwill is set out below:
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil.(Note 1.2.3.) |
INCOME (EXPENSES) BY NATURE |
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INCOME (EXPENSES) BY NATURE | 29.INCOME (EXPENSES) BY NATURE
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||||||||||||||||
Accounting policies adopted | 3.1.New accounting policies and changes in accounting policies adopted The new standards and interpretations issued, until the issuance of the Company’s unaudited condensed consolidated interim financial information, are described below. 3.1.1.Accounting policies adopted
The amendments to IAS 1 affect only the presentation of liabilities as current or non-current in the balance sheet, and not the amount or the timing of the recognition of any asset, liability, income or expense, or the information disclosed about these items. The amendments clarify that the classification of liabilities as current or non-current is based on the rights existing at the balance sheet date, specify that the classification is not affected by expectations about whether an entity will exercise its right to postpone the settlement of the liability, explain that the rights exist if restrictive clauses are complied with at the balance sheet date, and introduce the definition of ‘settlement’ to clarify that it refers to a transfer to a counterparty of an amount in cash, equity instruments, other assets or services. The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments change the requirements in IAS 1 with regard to the disclosure of accounting policies. The amendments replace all instances of the term ‘significant accounting policies’ with ‘material accounting policy information’. Accounting policy information is material if, considered together with other information included in an entity’s financial statements, it can reasonably be expected to influence the decisions that the primary users of the financial statements make on the basis of those financial statements. The supporting paragraphs in IAS 1 are also amended to clarify that accounting policy information that relates to immaterial transactions, other events or conditions is immaterial, and need not be disclosed. Accounting policy information may be material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial. However, not all accounting policy information relating to material transactions, other events or conditions is itself material. The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments replace the definition of a change in accounting estimates with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. The definition of a change in accounting estimates was deleted. However, the Board retained the concept of changes in accounting estimates in the Standard through the following clarifications:
The Company assessed the content of this pronouncement and did not identify any impacts.
The amendments introduce a further exception to the initial recognition exemption. Under the amendments, an entity may not apply the initial recognition exemption for transactions that give rise to equal taxable and deductible temporary differences. Depending on the applicable tax law, equal taxable and deductible temporary differences may arise from the initial recognition of an asset and liability in a transaction that is not a business combination and affects neither the accounting nor the taxable profit. For example, this may arise upon the recognition of a lease liability and the corresponding right-of-use asset, applying IFRS 16 at the commencement date of a lease. Following the amendments to IAS 12, an entity is required to recognise the related deferred tax asset and liability, with the recognition of any deferred tax asset being subject to the recoverability criteria in IAS 12. The amendments apply to transactions that occur on or after the beginning of the earliest comparative period presented. In addition, at the beginning of the earliest comparative period, an entity recognises:
The Company assessed the content of this pronouncement and did not identify any impacts. |
COMPANY'S OPERATIONS (Tables) |
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COMPANY'S OPERATIONS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of equity interest in the entities |
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Summary of allocation of preliminary purchase price |
(4)Goodwill is attributable to the workforce and expected future profitability of the acquired business. It will be deductible for tax purposes.
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FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT (Tables) |
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FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of financial instruments by category | All transactions with financial instruments are recognized for accounting purposes and classified in the following categories:
1)Does not include items not classified as financial instruments. |
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Summary of estimated fair value of loans and financing | The estimated fair values of loans and financing are set forth below:
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Schedule of contractual maturities of financial liabilities | The remaining contractual maturities of financial liabilities are presented as of the balance sheet date. The amounts as set forth below consist of undiscounted cash flow, and include interest payments and exchange rate variations, and therefore may not reconcile with the amounts disclosed in the balance sheet.
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Schedule of net exposure of assets and liabilities in foreign currency | The assets and liabilities that are exposed to foreign currency, substantially in U.S. Dollars, are set forth below:
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Schedule of derivatives by type of contract | The positions of outstanding derivatives are set forth below:
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Schedule of maturity analysis for derivatives |
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Schedule of long and short positions of outstanding derivatives | The outstanding derivatives positions are set forth below:
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Schedule of fair value settled derivatives | The settled derivatives positions are set forth below:
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Schedule of fair value hierarchy |
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Currency Risk | Financial instruments, excluding derivatives | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of sensitivity analysis | The following table set forth the potential impacts at their absolute amounts:
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Currency Risk | Derivative financial instruments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of sensitivity analysis | The following table set out the possible impacts assuming these scenarios:
(1)Long positions at US$/EUR parity in order to protect the Capex cash flow of the Cerrado Project against the appreciation of the Euro.
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Interest rate risk | Financial instruments, excluding derivatives | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of sensitivity analysis | The following table set forth the possible impacts assuming these scenarios in absolute amounts:
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Interest rate risk | Derivative financial instruments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of sensitivity analysis | The following table sets out the possible impacts of these assumed scenarios:
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U.S. Consumer Price Index | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of sensitivity analysis | The following table sets out the possible impacts, assuming these scenarios in absolute amounts:
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CASH AND CASH EQUIVALENTS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of cash and cash equivalents |
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MARKETABLE SECURITIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
MARKETABLE SECURITIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of marketable securities |
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TRADE ACCOUNTS RECEIVABLE (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
TRADE ACCOUNTS RECEIVABLE | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of trade accounts receivable by type of customer |
(1)The balance refers to transactions with Ibema Companhia Brasileira de Papel. |
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Schedule of trade accounts receivable by maturity |
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Schedule of rollforward of expected credit losses, trade accounts receivable |
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INVENTORIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of inventories |
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Schedule of changes in expected losses |
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RECOVERABLE TAXES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RECOVERABLE TAXES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of recoverable taxes |
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Schedule of changes in provision for loss |
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ADVANCES TO SUPPLIERS (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
ADVANCES TO SUPPLIERS | ||||||||||||||||||||||||||||||||||||||||||||||
Schedule of advances to suppliers |
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RELATED PARTIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RELATED PARTIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of related party transactions |
1) Refers mainly to the sale of pulp.
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Schedule of management compensation |
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INCOME AND SOCIAL CONTRIBUTION TAXES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME AND SOCIAL CONTRIBUTION TAXES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of deferred income and social contribution taxes |
1)Accelerated tax depreciation is taken as a benefit only in the income tax calculation bases. |
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Schedule of accumulated tax losses and social contribution tax loss carryforwards |
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Schedule of changes in net balance of deferred income tax |
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Schedule of changes in the effects of income tax and social contribution on profit or loss |
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Schedule of tax incentives | The Company benefits from a tax incentive for partial reduction of the income tax obtained from operations carried out in areas under the jurisdiction of the Northeast Development Superintendence (“SUDENE”) and the Superintendence of Amazon Development (“SUDAM”). The IRPJ reduction incentive is calculated based on the activity profits (exploitation profits) and considers the allocation of the operating profit based on the incentive production levels for each product.
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BIOLOGICAL ASSETS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
BIOLOGICAL ASSETS. | |||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in balances of biological assets | The roll-forward of biological assets is as set forth below:
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Schedule of assumptions used in calculation of fair value of biological assets | The table below discloses the measurement of the premises adopted:
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Schedule of fair value adjustment | The fair value adjustment justified by the combined variations of the indicators mentioned above resulted in a positive variation of R$1,256,315 recognized in other operating income (expenses), net (Note 30).
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INVESTMENTS (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of investments by type |
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Schedule of investments in associates and joint ventures |
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PROPERTY, PLANT AND EQUIPMENT (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY, PLANT AND EQUIPMENT | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of property, plant and equipment |
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INTANGIBLE (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INTANGIBLE | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill and intangible assets with indefinite useful life |
1)Refers to the goodwill of the MMC Brasil business combination, whose allocation of the purchase price is disclosed in note 1.2.3. 2)Refers to other intangible assets with indefinite useful lives such as servitude of passage and electricity. |
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Schedule of intangible assets with determined useful life |
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil Indústria e Comércio Ltda.(Note 1.2.3.) |
TRADE ACCOUNTS PAYABLE (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
TRADE ACCOUNTS PAYABLE | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of trade accounts payable |
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LOANS, FINANCING AND DEBENTURES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS, FINANCING AND DEBENTURES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of loans, financing and debentures by type |
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Schedule of non-current portion of loans, financing and debentures by maturity |
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Summary of changes in loans, financing and debentures |
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Schedule of loans and financing by currency |
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Schedule of fundraising costs and premiums of securities | The fundraising costs are amortized based on the terms of agreements and the effective interest rate.
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LEASES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASES | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of right of use assets | The balances rolled forward are set out below:
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Schedule of present value of lease liabilities | The balance of lease payables on June 30, 2023, measured at present value and discounted at the respective discount rates are set forth below:
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Summary of changes in lease liabilities | The balances rolled forward are set out below:
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Schedule of expenses recognised in profit or loss | The amounts recognized are set out below:
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PROVISION FOR JUDICIAL LIABILITIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROVISION FOR JUDICIAL LIABILITIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rollforward and changes in the provisions according to the nature of the proceedings for probable losses, net of judicial deposits |
2)Reversal due to a change in likelihood and/or due to settlement. |
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Schedule of possible losses for which no provision has been recorded | The Company is involved in tax, civil and labor lawsuits, whose losses have been assessed as possible by Management, supported by legal counsel, and therefore no provision was recorded:
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EMPLOYEE BENEFIT PLANS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
EMPLOYEE BENEFIT PLANS | |||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in actuarial liabilities |
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SHARE-BASED COMPENSATION PLAN (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION PLAN | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in long term compensation plans | The roll-forward arrangements are set out below:
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Summary of position for restricted share plan | The position is set forth below:
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Schedule of amounts corresponding to services received and recognized | The amounts corresponding to the services received and recognized are set forth below:
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LIABILITIES FOR ASSETS ACQUISITIONS AND ASSOCIATES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LIABILITIES FOR ASSETS ACQUISITIONS AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of liabilities for assets acquisitions |
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SHAREHOLDERS' EQUITY (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of share capital |
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Schedule of treasury shares |
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EARNINGS (LOSS) PER SHARE (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||
EARNINGS (LOSS) PER SHARE | |||||||||||||||||||||||||||||||||||||||||
Schedule of basic earnings (losses) per share |
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Schedule of diluted earnings (losses) per share |
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NET FINANCIAL RESULT (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NET FINANCIAL RESULT | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of net financial result |
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NET SALES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
NET SALES | |||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of reconciliation from gross sales to net sales revenue |
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SEGMENT INFORMATION (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of operating segments |
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Schedule of net sales by product |
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Goodwill based on expected future profitability | The goodwill based on expected future profitability arising from the business combination was allocated to the disclosable segments, which correspond to the Company’s cash-generating units (“CGUs”), considering the economic benefits generated by such intangible assets. The allocation of goodwill is set out below:
1)On June 1, 2023, the Company completed the acquisition of MMC Brasil.(Note 1.2.3.) |
INCOME (EXPENSES) BY NATURE (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME (EXPENSES) BY NATURE | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of results by nature |
|
COMPANY'S OPERATIONS - Summary (Details) |
6 Months Ended |
---|---|
Jun. 30, 2023
item
| |
Domestic (Brazil) | |
COMPANY'S OPERATIONS | |
Number of industrial units | 13 |
Number of technology centers | 5 |
Number of distribution centers | 23 |
Number of ports | 3 |
Suzano Holding S.A. | |
COMPANY'S OPERATIONS | |
Percentage of ownership interest in subsidiary | 47.12% |
COMPANY'S OPERATIONS - Cerrado Project (Details) - Cerrado Project R$ in Thousands |
Oct. 28, 2021
BRL (R$)
T
|
---|---|
COMPANY'S OPERATIONS | |
Estimate of the annual capacity to produce eucalyptus pulp (in tons) | T | 2,550,000 |
Aggregate amount of industrial capital investment | R$ | R$ 22,200,000 |
COMPANY'S OPERATIONS - Acquisition of tissue business in Brazil (Details) - MMC Brasil Industria e Comercio Ltda. R$ in Thousands, $ in Millions |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023
BRL (R$)
|
Jun. 01, 2023
USD ($)
|
Jun. 01, 2023
BRL (R$)
|
|
COMPANY'S OPERATIONS | |||
Total purchase consideration (full payment on closing) | $ 212,029 | R$ 1,072,657 | |
Book value of Shareholders' Equity of MMC Brasil | 587,226 | ||
Fair value adjustment | |||
Inventories | 7,120 | ||
Property, plant and equipment | 105,858 | ||
Trademark and patents | 189,655 | ||
Net identifiable assets acquired | 889,859 | ||
Goodwill | R$ 182,798 | ||
Deferred tax recognized on fair value adjustments | R$ 0 | ||
Acquisition related costs included in administrative expenses in profit or loss | R$ 12,105 |
COMPANY'S OPERATIONS -Treasury shares cancelled (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands |
6 Months Ended | ||
---|---|---|---|
Feb. 28, 2023 |
Jun. 30, 2023 |
Dec. 31, 2022 |
|
COMPANY'S OPERATIONS | |||
Number of shares cancelled | 37,145,969 | 37,145,969 | |
Average price per share of shares cancelled | R$ 40.84 | R$ 40.84 | |
Aggregate value of shares cancelled | R$ 1,517,224 | R$ 1,517,224 | |
Share capital | R$ 9,235,546 | R$ 9,235,546 | |
Quantity of ordinary shares | 1,324,117,615 | 1,361,263,584 | |
Treasury shares | |||
COMPANY'S OPERATIONS | |||
Quantity of ordinary shares | 32,466,900 | 51,911,569 | |
Share Capital | |||
COMPANY'S OPERATIONS | |||
Share capital | R$ 9,269,281 | R$ 9,269,281 | |
Quantity of ordinary shares | 1,324,117,615 |
COMPANY'S OPERATIONS -Biomas (Details) - Biomas Servicos Ambientais, Restauracao e Carbono S.A. - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Feb. 27, 2023 |
Jun. 30, 2023 |
Dec. 31, 2022 |
|
COMPANY'S OPERATIONS | |||
Commitment to invest | R$ 20,000 | ||
Aggregate amount paid from all partners | R$ 30,000 | ||
Amount paid from each partner | 5,000 | ||
Remaining balance of commitment from all partners | 90,000 | ||
Remaining balance of commitment from each partner | R$ 15,000 | ||
Percentage of ownership equity interests, Equity | 16.66% | 100.00% |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT - Sensitivity analysis to changes in the consumer price indices of the US economy (Details) - Commodity price risk - Embedded derivative - Forestry partnership agreement R$ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2023
BRL (R$)
| |
Probable | |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |
Effect on fair value of assets attributable to an increase in measurement input | R$ 187,618 |
Possible (25%) | |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |
Effect on fair value of assets attributable to an increase in measurement input | (31,171) |
Remote (50%) | |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | |
Effect on fair value of assets attributable to an increase in measurement input | R$ (64,295) |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT - Derivatives outstanding by type of contract, classified (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT | ||
Current assets | R$ 3,747,881 | R$ 3,048,493 |
Non-current assets | 1,731,906 | 1,825,256 |
Current liabilities | (483,512) | (667,681) |
Non-current liabilities | (1,735,204) | (4,179,114) |
Total, net | R$ 3,261,071 | R$ 26,954 |
FINANCIAL INSTRUMENTS AND RISKS MANAGEMENT - Fair value by maturity schedule (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Financial Instruments and Risks | ||
Derivative fair value asset (liability), net | R$ 3,261,071 | R$ 26,954 |
2023 | ||
Financial Instruments and Risks | ||
Derivative fair value asset (liability), net | 2,413,838 | 2,380,812 |
2024 | ||
Financial Instruments and Risks | ||
Derivative fair value asset (liability), net | 1,785,080 | 297,156 |
2025 | ||
Financial Instruments and Risks | ||
Derivative fair value asset (liability), net | (477,814) | (1,225,193) |
2026 onwards | ||
Financial Instruments and Risks | ||
Derivative fair value asset (liability), net | R$ (460,033) | R$ (1,425,821) |
CASH AND CASH EQUIVALENTS (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|
Cash equivalents | ||||
Total cash and cash equivalents | R$ 11,860,415 | R$ 9,505,951 | R$ 7,712,081 | R$ 13,590,776 |
Cash and banks | ||||
Cash and cash equivalents | ||||
Cash and banks | R$ 10,327,055 | 8,064,193 | ||
Fixed | Cash and banks | ||||
Cash equivalents | ||||
Average yield p.a. % | 5.34% | |||
Local | Fixed-term deposits (Compromised) | ||||
Cash equivalents | ||||
Fixed-term deposits | R$ 560,985 | R$ 1,441,758 | ||
Local | CDI | Fixed-term deposits (Compromised) | ||||
Cash equivalents | ||||
Percentage of basis used to calculate interest rate | 97.30% | |||
Foreign | Fixed-term deposits | ||||
Cash equivalents | ||||
Fixed-term deposits | R$ 972,375 | |||
Foreign | Fixed | Fixed-term deposits | ||||
Cash equivalents | ||||
Average yield p.a. % | 6.01% |
TRADE ACCOUNTS RECEIVABLE - Breakdown of balances (Details) - Trade accounts receivable - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | R$ 6,488,192 | R$ 9,607,012 |
Factoring of receivables | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 4,227,031 | 6,889,492 |
Gross | Domestic (Brazil) | Third parties | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 1,599,377 | 1,915,745 |
Gross | Domestic (Brazil) | Related parties | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 73,564 | 99,608 |
Gross | Foreign | Third parties | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 4,845,044 | 7,612,768 |
Expected credit losses | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | R$ 29,793 | R$ 21,109 |
TRADE ACCOUNTS RECEIVABLE - Breakdown of trade accounts receivable by maturity (Details) - Trade accounts receivable - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | R$ 6,488,192 | R$ 9,607,012 |
Neither past due nor impaired | Current | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 5,432,105 | 8,652,376 |
Past due but not impaired | Up to 30 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 855,757 | 777,150 |
Past due but not impaired | From 31 to 60 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 44,915 | 74,253 |
Past due but not impaired | From 61 to 90 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 50,212 | 54,784 |
Past due but not impaired | From 91 to 120 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 9,921 | 20,975 |
Past due but not impaired | From 121 to 180 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | 50,728 | 18,945 |
Past due but not impaired | From 181 days | ||
TRADE ACCOUNTS RECEIVABLE | ||
Financial assets | R$ 44,554 | R$ 8,529 |
TRADE ACCOUNTS RECEIVABLE - Rollforward of expected credit losses (Details) - Trade accounts receivable - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Rollforward of the expected credit losses | ||
Opening balance | R$ (21,109) | R$ (34,763) |
Additions | (10,464) | (5,228) |
Reversals | 177 | 3,576 |
Write-offs | 1,536 | 12,355 |
Exchange rate variation | (67) | (2,951) |
Closing balance | R$ (29,793) | R$ (21,109) |
TRADE ACCOUNTS RECEIVABLE - Main customers (Details) - Net Sales - customer |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Pulp | ||
TRADE ACCOUNTS RECEIVABLE | ||
Number of major customers responsible for more than 10% of net sales | 1 | 1 |
Concentration risk percentage | 12.37% | 10.67% |
Paper | ||
TRADE ACCOUNTS RECEIVABLE | ||
Number of major customers responsible for more than 10% of net sales | 0 | 0 |
Threshold concentration risk percentage | 10.00% | 10.00% |
INVENTORIES - Balances (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
INVENTORIES | ||
Work in process | R$ 119,644 | R$ 93,964 |
Spare parts and other | 978,951 | 843,469 |
Inventories | 6,422,496 | 5,728,261 |
Pulp | Domestic (Brazil) | ||
INVENTORIES | ||
Finished goods | 501,037 | 616,415 |
Pulp | Foreign | ||
INVENTORIES | ||
Finished goods | 1,711,100 | 1,426,064 |
Paper | Domestic (Brazil) | ||
INVENTORIES | ||
Finished goods | 535,026 | 358,973 |
Paper | Foreign | ||
INVENTORIES | ||
Finished goods | 245,267 | 192,671 |
Wood | ||
INVENTORIES | ||
Raw materials | 1,586,058 | 1,480,616 |
Operating supplies and packaging | ||
INVENTORIES | ||
Raw materials | R$ 745,413 | R$ 716,089 |
INVENTORIES - Roll-forward of estimated losses (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Roll-forward of estimated losses | ||
Inventories pledged as collateral | R$ 0 | R$ 0 |
Inventories | ||
Roll-forward of estimated losses | ||
Opening balance | (105,989) | (91,258) |
Additions | (23,859) | (89,552) |
Reversals | 24,713 | 33,492 |
Write-offs | 17,893 | 41,329 |
Closing balance | R$ (87,242) | R$ (105,989) |
RECOVERABLE TAXES - Summary (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
RECOVERABLE TAXES | |||
IRPJ/CSLL - prepayments and withheld taxes | R$ 328,747 | R$ 179,812 | |
PIS and COFINS - on acquisitions of property, plant and equipment | 87,955 | 89,334 | |
PIS and COFINS - operations | 615,322 | 523,970 | |
PIS/COFINS - exclusions from ICMS | 458,319 | 570,945 | |
ICMS - on acquisitions of property, plant and equipment | 358,999 | 167,286 | |
ICMS - operations | 1,446,388 | 1,423,375 | |
Reintegra program | 76,549 | 65,971 | |
Other taxes and contributions | 39,690 | 39,057 | |
Provision for loss on ICMS credits | (1,306,768) | (1,103,807) | R$ (1,064,268) |
Recoverable taxes | 2,105,201 | 1,955,943 | |
Current | 747,847 | 549,580 | |
Non-current | R$ 1,357,354 | R$ 1,406,363 |
RECOVERABLE TAXES - Roll-forward of provision for loss (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
ICMS | ||
Opening balance | R$ (1,103,807) | R$ (1,064,268) |
Addition | (217,782) | (221,903) |
Write-off | 18,464 | |
Reversal | 14,821 | 163,900 |
Closing balance | R$ (1,306,768) | R$ (1,103,807) |
ADVANCES TO SUPPLIERS (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Advances to suppliers | ||
Advances to suppliers | R$ 2,084,380 | R$ 1,700,278 |
Current | 103,181 | 108,146 |
Non current | 1,981,199 | 1,592,132 |
Forestry development program and partnerships | ||
Advances to suppliers | ||
Advances to suppliers | 1,981,199 | 1,592,132 |
Advance to suppliers - others | ||
Advances to suppliers | ||
Advances to suppliers | R$ 103,181 | R$ 108,146 |
RELATED PARTIES - Management compensation (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Short-term benefits | ||
Salary or compensation | R$ 23,822 | R$ 24,741 |
Direct and indirect benefits | 1,194 | 464 |
Bonus | 4,724 | 3,516 |
Total short term benefits | 29,740 | 28,721 |
Long-term benefits | ||
Share-based compensation plan | 12,407 | 25,726 |
Total long term benefits | 12,407 | 25,726 |
Total management compensation | R$ 42,147 | R$ 54,447 |
INCOME AND SOCIAL CONTRIBUTION TAXES - Summary (Details) R$ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2023
BRL (R$)
| |
INCOME AND SOCIAL CONTRIBUTION TAXES | |
Base rate for income tax and social contribution taxes | 15.00% |
Additional income tax rate on taxable income in excess of threshold amount | 10.00% |
Threshold amount of income for additional tax rate | R$ 240 |
Additional social contribution tax rate on taxable income in excess of threshold amount | 9.00% |
INCOME AND SOCIAL CONTRIBUTION TAXES - Carryforwards (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
INCOME AND SOCIAL CONTRIBUTION TAXES | ||
Tax loss carryforward | R$ 4,814,896 | R$ 4,828,384 |
Negative tax basis of social contribution carryforward | R$ 5,039,311 | R$ 4,947,222 |
BIOLOGICAL ASSETS - Roll-forward of biological assets (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Roll-forward of biological assets | |||
Opening balance | R$ 14,632,186 | R$ 12,248,732 | R$ 12,248,732 |
Additions | 2,899,032 | 4,957,380 | |
Depletions | (1,805,371) | (3,665,057) | |
Gain on fair value adjustment | 1,256,315 | R$ 171,618 | 1,199,759 |
Disposals | (36,278) | (82,331) | |
Other write-offs | (31,764) | (26,297) | |
Closing balance | R$ 16,914,120 | R$ 14,632,186 | |
Effective area of forest from the year of planting | 3 years | ||
Minimum | |||
Roll-forward of biological assets | |||
Average cycle of forest formation | 6 years | ||
Maximum | |||
Roll-forward of biological assets | |||
Average cycle of forest formation | 7 years |
BIOLOGICAL ASSETS - Measurement of the premises adopted (Details) |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023
ha
R$ / m³
m / ha
|
Dec. 31, 2022
ha
m / ha
R$ / m³
|
|
BIOLOGICAL ASSETS | ||
Planted useful area (hectare) | 1,105,168 | 1,097,081 |
Average annual growth (IMA) - m3/hectare /year | m / ha | 37.61 | 37.07 |
Average gross sale price of eucalyptus - R$/m3 | R$ / m³ | 97.34 | 90.16 |
Discount rate - % (post-tax) | 8.80% | 9.10% |
Mature assets | ||
BIOLOGICAL ASSETS | ||
Planted useful area (hectare) | 181,573 | 134,752 |
Immature assets | ||
BIOLOGICAL ASSETS | ||
Planted useful area (hectare) | 923,595 | 962,329 |
BIOLOGICAL ASSETS - Fair value adjustment (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Fair value adjustment of biological assets recognized under other operating income (expense), net | |||
Physical changes | R$ 432,212 | R$ (37,088) | |
Price | 824,103 | 1,236,847 | |
Fair value adjustment of biological assets | 1,256,315 | R$ 171,618 | 1,199,759 |
Biological assets pledged | R$ 0 | R$ 0 |
INVESTMENTS - Investments breakdown (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
INVESTMENTS | ||
Investments in associates and joint ventures | R$ 383,500 | R$ 354,200 |
Goodwill | 233,228 | 233,399 |
Other investments evaluated at fair value through other comprehensive income - Celluforce | 23,541 | 24,917 |
Total investments | R$ 640,269 | R$ 612,516 |
PROPERTY, PLANT AND EQUIPMENT - Other disclosures (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Property, Plant and Equipment | ||
Property, plant and equipment pledged as collateral | R$ 12,856,211 | R$ 12,773,662 |
Property, plant and equipment, interest costs capitalized | R$ 511,650 | R$ 359,407 |
Average monthly rate of interest capitalization | 11.78% | 12.49% |
INTANGIBLE - Goodwill and intangible assets with indefinite useful life (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
INTANGIBLE | ||
Goodwill | R$ 233,228 | R$ 233,399 |
Other | 4,018 | 3,405 |
Goodwill and intangible assets with indefinite useful life | 8,203,199 | 8,019,788 |
Facepa | ||
INTANGIBLE | ||
Goodwill | 119,332 | 119,332 |
Fibria | ||
INTANGIBLE | ||
Goodwill | 7,897,051 | R$ 7,897,051 |
MMC Brasil | ||
INTANGIBLE | ||
Goodwill | R$ 182,798 |
INTANGIBLE - Changes in intangible assets with limited useful lives (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Intangible assets with determined useful life | ||
Opening balance | R$ 7,173,183 | R$ 8,014,740 |
Additions | 197 | 90,499 |
Fair value adjustment MMC Brasil | 189,655 | |
Write-offs | (51) | |
Amortization | (489,650) | (966,796) |
Transfers and others | 35,563 | 34,791 |
Closing balance | R$ 6,908,948 | R$ 7,173,183 |
TRADE ACCOUNTS PAYABLE (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Trade accounts payable | ||
Trade accounts payable | R$ 6,347,954 | R$ 6,206,570 |
Domestic (Brazil) | Related party | ||
Trade accounts payable | ||
Trade accounts payable | 13,161 | 3,776 |
Domestic (Brazil) | Third party | ||
Trade accounts payable | ||
Trade accounts payable | 4,305,857 | 4,171,988 |
Trade accounts payables balances subject to factoring at the exclusive option of certain suppliers | 243,229 | 416,643 |
Domestic (Brazil) | Third party | Cerrado Project | ||
Trade accounts payable | ||
Trade accounts payable | 988,892 | 625,645 |
Foreign | Third party | ||
Trade accounts payable | ||
Trade accounts payable | 2,028,936 | 2,030,806 |
Foreign | Third party | Cerrado Project | ||
Trade accounts payable | ||
Trade accounts payable | R$ 1,656,702 | R$ 1,370,833 |
LOANS, FINANCING AND DEBENTURES - Interest and non-current funding (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Current | |||
Interest on financing | R$ 1,141,837 | R$ 1,238,623 | |
Non-current funding | 4,390,706 | 2,096,406 | |
Current borrowings | 5,532,543 | 3,335,029 | |
Non-current | |||
Non-current funding | 68,999,788 | 71,239,562 | |
Non-current borrowings | 68,999,788 | 71,239,562 | |
Total | |||
Interest on financing | 1,141,837 | 1,238,623 | |
Non-current funding | 73,390,494 | 73,335,968 | |
Total loans, financing and debentures | R$ 74,532,331 | R$ 74,574,591 | R$ 79,628,629 |
LOANS, FINANCING AND DEBENTURES - Rollforward in loans, financing and debentures (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
LOANS, FINANCING AND DEBENTURES | ||
Opening balance | R$ 74,574,591 | R$ 79,628,629 |
Fundraising, net of issuance costs | 5,276,816 | 1,335,715 |
Interest accrued | 2,309,587 | 4,007,737 |
Monetary and exchange rate variation, net | (4,543,048) | (3,949,020) |
Settlement of principal | (765,533) | (2,517,934) |
Settlement of interest | (2,352,484) | (4,019,072) |
Amortization of fundraising costs | 32,402 | 69,649 |
Others (fair value adjustments on business combinations) | 18,887 | |
Closing balance | R$ 74,532,331 | R$ 74,574,591 |
LOANS, FINANCING AND DEBENTURES - Breakdown by currency (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
LOANS, FINANCING AND DEBENTURES | |||
Borrowings | R$ 74,532,331 | R$ 74,574,591 | R$ 79,628,629 |
Brazilian Reais | |||
LOANS, FINANCING AND DEBENTURES | |||
Borrowings | 14,355,349 | 13,347,244 | |
US Dollars | |||
LOANS, FINANCING AND DEBENTURES | |||
Borrowings | 60,172,808 | 61,216,140 | |
Currency basket | |||
LOANS, FINANCING AND DEBENTURES | |||
Borrowings | R$ 4,174 | R$ 11,207 |
LOANS, FINANCING AND DEBENTURES - Significant transactions settled during the period (Details) - CRA Settlement - CRA contract R$ in Thousands |
Jun. 22, 2023
BRL (R$)
|
---|---|
LOANS, FINANCING AND DEBENTURES | |
Transaction amount settled | R$ 685,239 |
IPCA | |
LOANS, FINANCING AND DEBENTURES | |
Interest rate basis | IPCA + 5.9844% |
Basis spread (as a percent) | 5.9844% |
LEASES - Right of use assets (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Right of use assets | ||
Beginning balance | R$ 5,109,226 | R$ 4,794,023 |
Additions/updates | 455,252 | 982,680 |
Depreciation | (333,635) | (592,451) |
Write-offs | (54) | (75,026) |
Ending balance | 5,230,789 | 5,109,226 |
Lands | ||
Right of use assets | ||
Beginning balance | 3,283,156 | 2,868,411 |
Additions/updates | 290,722 | 849,996 |
Depreciation | (188,802) | (360,225) |
Write-offs | (54) | (75,026) |
Ending balance | 3,385,022 | 3,283,156 |
Machinery and equipment | ||
Right of use assets | ||
Beginning balance | 112,553 | 86,464 |
Additions/updates | 85,493 | 66,821 |
Depreciation | (51,778) | (40,732) |
Ending balance | 146,268 | 112,553 |
Buildings | ||
Right of use assets | ||
Beginning balance | 85,756 | 88,410 |
Additions/updates | 78,547 | 61,647 |
Depreciation | (29,419) | (64,301) |
Ending balance | 134,884 | 85,756 |
Ships and boats | ||
Right of use assets | ||
Beginning balance | 1,623,118 | 1,748,008 |
Depreciation | (62,445) | (124,890) |
Ending balance | 1,560,673 | 1,623,118 |
Vehicles | ||
Right of use assets | ||
Beginning balance | 4,643 | 2,730 |
Additions/updates | 490 | 4,216 |
Depreciation | (1,191) | (2,303) |
Ending balance | R$ 3,942 | R$ 4,643 |
LEASES - Lease liabilities (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Lease Liabilities | |||
Present value of liabilities | R$ 6,195,984 | R$ 6,182,530 | R$ 5,893,194 |
Lands and farms | |||
Lease Liabilities | |||
Average rate - % p.a. | 12.52% | ||
Present value of liabilities | R$ 3,673,964 | ||
Machinery and equipment | |||
Lease Liabilities | |||
Average rate - % p.a. | 11.43% | ||
Present value of liabilities | R$ 217,381 | ||
Buildings | |||
Lease Liabilities | |||
Average rate - % p.a. | 10.84% | ||
Present value of liabilities | R$ 122,556 | ||
Ships and boats | |||
Lease Liabilities | |||
Average rate - % p.a. | 11.39% | ||
Present value of liabilities | R$ 2,178,580 | ||
Vehicles | |||
Lease Liabilities | |||
Average rate - % p.a. | 10.83% | ||
Present value of liabilities | R$ 3,503 |
LEASES - Changes in lease liabilities (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Lease Liabilities | ||
Opening balance | R$ 6,182,530 | R$ 5,893,194 |
Additions | 455,252 | 982,680 |
Write-offs | (54) | (75,026) |
Payments | (577,132) | (1,044,119) |
Accrual of financial charges | 327,374 | 612,042 |
Exchange rate variation | (191,986) | (186,241) |
Closing balance | 6,195,984 | 6,182,530 |
Current | 710,906 | 672,174 |
Non-current | 5,485,078 | 5,510,356 |
Leased Land | Biological assets | ||
Lease Liabilities | ||
Capitalized interest | R$ 104,137 | R$ 178,429 |
LEASES - Amounts recognized in the statement of income for the year (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
LEASES | ||
Expenses relating to short-term assets | R$ 5,559 | R$ 1,038 |
Expenses relating to low-value assets | 946 | 571 |
Total amount recognized | R$ 6,505 | R$ 1,609 |
PROVISION FOR JUDICIAL LIABILITIES - Contingencies with possible losses (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
PROVISION FOR JUDICIAL LIABILITIES | ||
Possible losses for which no provision was recorded | R$ 14,417,316 | R$ 12,937,551 |
Fibria | ||
PROVISION FOR JUDICIAL LIABILITIES | ||
Fair value adjustment of probable contingencies | 2,537,335 | 2,614,518 |
Taxes and social security | ||
PROVISION FOR JUDICIAL LIABILITIES | ||
Possible losses for which no provision was recorded | 9,211,342 | 8,201,246 |
Labor | ||
PROVISION FOR JUDICIAL LIABILITIES | ||
Possible losses for which no provision was recorded | 224,181 | 321,428 |
Civil and environment | ||
PROVISION FOR JUDICIAL LIABILITIES | ||
Possible losses for which no provision was recorded | R$ 4,981,793 | R$ 4,414,877 |
EMPLOYEE BENEFIT PLANS (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Defined benefit plan | |||
Roll-forward of actuarial liability | |||
Opening balance | R$ 691,424 | R$ 675,158 | R$ 675,158 |
Interest on actuarial liabilities | 34,615 | 59,258 | |
Actuarial loss (gain) | 12,231 | ||
Exchange rate variations | (577) | ||
Amount arising from the acquisition of MMC Brasil | 1,457 | ||
Benefits paid | (25,563) | (54,646) | |
Closing balance | 701,933 | R$ 691,424 | |
Suzano Prev | |||
EMPLOYEE BENEFIT PLANS | |||
Employer contributions | R$ 8,650 | R$ 7,308 |
SHARE-BASED COMPENSATION PLAN - Long term compensation plans ("PS and SAR") (Details) |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023
EquityInstruments
item
R$ / shares
|
Dec. 31, 2022
EquityInstruments
R$ / shares
|
|
SHARE-BASED COMPENSATION PLAN | ||
Number of share-based compensation plans | item | 3 | |
PS and SAR | ||
Number of shares | ||
Opening balance | 7,583,185 | 5,415,754 |
Granted during of the period | 3,318,892 | 4,152,200 |
Exercised | (244,464) | (1,474,506) |
Exercised due to resignation | (24,743) | (175,552) |
Abandoned/cancelled due to resignation | (225,126) | (334,711) |
Closing balance | 10,407,744 | 7,583,185 |
Average exercise price | R$ / shares | R$ 47.78 | R$ 48.79 |
SHARE-BASED COMPENSATION PLAN - Restricted shares plan (Details) - Restricted shares |
6 Months Ended |
---|---|
Jun. 30, 2023
EquityInstruments
R$ / shares
| |
SHARE-BASED COMPENSATION PLAN | |
Shares Granted | 487,365 |
Restricted Shares Plan, 2020 | |
SHARE-BASED COMPENSATION PLAN | |
Price on grant date | R$ / shares | R$ 51.70 |
Shares Granted | 111,685 |
Restricted Shares Plan, 2021 | |
SHARE-BASED COMPENSATION PLAN | |
Price on grant date | R$ / shares | R$ 53.81 |
Shares Granted | 113,161 |
Restricted Shares Plan, 2022 | |
SHARE-BASED COMPENSATION PLAN | |
Price on grant date | R$ / shares | R$ 52.00 |
Shares Granted | 101,164 |
Restricted Shares Plan, 2023 | |
SHARE-BASED COMPENSATION PLAN | |
Price on grant date | R$ / shares | R$ 49.58 |
Shares Granted | 161,355 |
SHARE-BASED COMPENSATION PLAN - Measurement assumptions (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Liabilities and Equity | |||
Non-current liabilities, Provision for phantom stock plan | R$ 183,589 | R$ 162,117 | |
Equity, Stock options granted | 22,584 | 20,790 | |
Equity, Shares granted | (2,365) | ||
Total effect on equity | 22,584 | R$ 18,425 | |
Statement of income and Equity | |||
Non-current liabilities, Provision for phantom stock plan | (32,731) | R$ (31,389) | |
Equity, Stock options granted | (4,159) | (2,668) | |
Equity, Shares granted | 2,365 | ||
Total Equity impact | (4,159) | (303) | |
Total income statement effect | R$ (36,890) | R$ (31,692) |
SHAREHOLDERS' EQUITY - Treasury shares (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands |
1 Months Ended | 6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|
Feb. 28, 2023 |
Oct. 27, 2022 |
Jul. 31, 2023 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
SHAREHOLDERS' EQUITY | |||||||
Number of shares held in treasury | 32,466,900 | 51,911,569 | 12,042,004 | ||||
Average cost per share | R$ 42.55 | R$ 40.84 | R$ 18.13 | ||||
Historical value | R$ 1,381,600 | R$ 2,120,324 | R$ 218,265 | ||||
Market value | R$ 1,435,686 | R$ 2,504,214 | R$ 656,530 | ||||
Number of shares cancelled | 37,145,969 | 37,145,969 | |||||
Number of shares repurchased | 17,701,300 | 40,000,000 | |||||
Value of shares repurchased | R$ 778,500 | R$ 601,551 | R$ 1,904,424 | ||||
Cash effect of shares repurchased | R$ 57,448 | R$ 721,052 | |||||
Repurchase Program | |||||||
SHAREHOLDERS' EQUITY | |||||||
Number of shares authorized for repurchase | 20,000,000 | ||||||
Share repurchase program maximum term | 18 months |
SHAREHOLDERS' EQUITY - Treasury Shares - Changes (Details) - BRL (R$) R$ / shares in Units, R$ in Thousands |
6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Feb. 28, 2023 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Quantity | ||||
Beginning balance | 51,911,569 | 12,042,004 | 12,042,004 | |
Realization in the restricted shares plan | 130,435 | |||
Repurchase | 17,701,300 | 40,000,000 | ||
Canceled | 37,145,969 | 37,145,969 | ||
Ending balance | 32,466,900 | 51,911,569 | ||
Average cost per share | ||||
Beginning balance | R$ 40.84 | R$ 18.13 | R$ 18.13 | |
Realization in the restricted shares plan | 18.13 | |||
Repurchase | 43.98 | 47.61 | ||
Canceled | R$ 40.84 | 40.84 | ||
Ending balance | R$ 42.55 | R$ 40.84 | ||
Historical value | ||||
Beginning balance | R$ 2,120,324 | R$ 218,265 | R$ 218,265 | |
Realization in the restricted shares plan | 2,365 | |||
Repurchase | 778,500 | 601,551 | 1,904,424 | |
Canceled | R$ 1,517,224 | 1,517,224 | ||
Ending balance | 1,381,600 | 2,120,324 | ||
Market value | ||||
Beginning balance | 2,504,214 | R$ 656,530 | 656,530 | |
Realization in the restricted shares plan | 8,156 | |||
Repurchase | 778,500 | 1,904,424 | ||
Canceled | 1,570,532 | |||
Beginning balance | R$ 1,435,686 | R$ 2,504,214 |
EARNINGS (LOSS) PER SHARE - Basic (Details) - BRL (R$) R$ / shares in Units, shares in Thousands, R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Basic earnings per share | ||||
Resulted of the period attributable to controlling shareholders | R$ 5,073,127 | R$ 175,625 | R$ 10,310,498 | R$ 10,480,342 |
Weighted average number of shares in the period - in thousands | 1,336,021 | 1,361,264 | ||
Weighted average treasury shares - in thousands | (26,791) | (14,088) | ||
Weighted average number of outstanding shares - in thousands | 1,309,230 | 1,347,176 | ||
Basic earnings (loss) per common share - R$ | R$ 3.90544 | R$ 0.13057 | R$ 7.87524 | R$ 7.77949 |
EARNINGS (LOSS) PER SHARE - Diluted (Details) - BRL (R$) R$ / shares in Units, shares in Thousands, R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Diluted earnings per share | ||||
Resulted of the period attributable to controlling shareholders | R$ 5,073,127 | R$ 175,625 | R$ 10,310,498 | R$ 10,480,342 |
Weighted average number of shares during the period (except treasury shares) - in thousands | 1,309,230 | 1,347,176 | ||
Average number of potential shares (stock options) - in thousands | 487 | 215 | ||
Weighted average number of shares (diluted) - in thousands | 1,309,717 | 1,347,391 | ||
Diluted earnings (loss) per common share - R$ | R$ 3.90397 | R$ 0.13054 | R$ 7.87231 | R$ 7.77825 |
EARNINGS (LOSS) PER SHARE - Profit reserves (Details) - BRL (R$) R$ in Thousands |
6 Months Ended | |
---|---|---|
Apr. 26, 2022 |
Jun. 30, 2023 |
|
Investment reserve | ||
SHAREHOLDERS' EQUITY | ||
Constitution of reserves | R$ 14,972,324 | R$ 14,972,324 |
NET SALES (Details) - BRL (R$) R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
NET SALES | ||||
Gross sales | R$ 24,552,121 | R$ 25,466,749 | ||
Sales deductions | ||||
Returns and cancelations | (65,560) | (42,388) | ||
Discounts and rebates | (3,019,895) | (3,187,446) | ||
Total | 21,466,666 | 22,236,915 | ||
Taxes on sales | (1,030,649) | (974,425) | ||
Net sales | R$ 9,159,634 | R$ 11,519,655 | R$ 20,436,017 | R$ 21,262,490 |
SEGMENT INFORMATION - Operating segment (Details) - BRL (R$) R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
SEGMENT INFORMATION | ||||
Net sales | R$ 9,159,634 | R$ 11,519,655 | R$ 20,436,017 | R$ 21,262,490 |
EBITDA | 10,968,481 | 11,571,481 | ||
Depreciation, depletion and amortization | (3,593,516) | (3,594,963) | ||
Operating profit before net financial income ("EBIT") | R$ 3,068,677 | R$ 4,587,437 | R$ 7,374,965 | R$ 7,976,518 |
EBITDA margin (%) | 53.67% | 54.42% | ||
Domestic (Brazil) | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 4,221,403 | R$ 3,836,636 | ||
Foreign | ||||
SEGMENT INFORMATION | ||||
Net sales | 16,214,614 | 17,425,854 | ||
Pulp | ||||
SEGMENT INFORMATION | ||||
Net sales | 16,302,347 | 17,496,421 | ||
EBITDA | R$ 9,155,697 | R$ 10,168,584 | ||
EBITDA margin (%) | 56.16% | 58.12% | ||
Pulp | Domestic (Brazil) | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 1,249,493 | R$ 1,246,965 | ||
Pulp | Foreign | ||||
SEGMENT INFORMATION | ||||
Net sales | 15,052,854 | 16,249,456 | ||
Paper | ||||
SEGMENT INFORMATION | ||||
Net sales | 4,133,670 | 3,766,069 | ||
EBITDA | R$ 1,812,784 | R$ 1,402,897 | ||
EBITDA margin (%) | 43.85% | 37.25% | ||
Paper | Domestic (Brazil) | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 2,971,910 | R$ 2,589,671 | ||
Paper | Foreign | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 1,161,760 | R$ 1,176,398 |
SEGMENT INFORMATION - Net sales by product (Details) - BRL (R$) R$ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
SEGMENT INFORMATION | ||||
Net sales | R$ 9,159,634 | R$ 11,519,655 | R$ 20,436,017 | R$ 21,262,490 |
Market pulp | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 16,302,347 | R$ 17,496,421 | ||
Fluff pulp | ||||
SEGMENT INFORMATION | ||||
Percentage of total net sales | 0.80% | 0.80% | ||
Printing and writing paper | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 3,384,698 | R$ 3,089,666 | ||
Tissue | ||||
SEGMENT INFORMATION | ||||
Percentage of total net sales | 3.10% | 2.50% | ||
Paperboard | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 708,576 | R$ 644,809 | ||
Other products | ||||
SEGMENT INFORMATION | ||||
Net sales | R$ 40,396 | R$ 31,594 |
SEGMENT INFORMATION - Goodwill based on expected future profitability (Details) - BRL (R$) R$ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
SEGMENT INFORMATION | ||
Goodwill based on expected future profitability | R$ 8,199,181 | R$ 8,016,383 |
Pulp | ||
SEGMENT INFORMATION | ||
Goodwill based on expected future profitability | 7,897,051 | 7,897,051 |
Paper | ||
SEGMENT INFORMATION | ||
Goodwill based on expected future profitability | R$ 302,130 | R$ 119,332 |
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