CMPC - Q1 2026 Earnings Analysis

Performance Highlights

CMPC reported Q1 2026 consolidated sales of $1.82 billion, up 0.2% year-over-year but down 3.9% sequentially, broadly in line with expectations given the known Guaíba maintenance drag. Adjusted EBITDA of $255 million came in 8.1% below the prior-year quarter at a 14.1% margin, with net income falling 50% year-over-year to $25 million, weighed down by lower biological asset valuations and higher net financial expenses.

The single most important operating driver this quarter was the scheduled full maintenance of both Guaíba lines, which pushed BHKP cash costs to $262 per ton — up 15% sequentially and 24% year-over-year — and compressed Pulp EBITDA to $155 million at a 21.2% margin. Partially offsetting this, Biopackaging staged a meaningful recovery with EBITDA of $23 million at a 9.4% margin after 4Q25 inventory write-downs did not recur, while Softys grew EBITDA 20% year-over-year to $97 million on Falcon consolidation and a richer personal care mix, despite sequential softness in Brazil and Mexico.

Management Outlook and Forward Catalysts

Management guided for progressive net debt-to-EBITDA normalization from 4.1x through 2026, underpinned by cost efficiencies, working capital optimization, and potential asset monetization, while reaffirming investment-grade status at BBB- with stable outlooks from all three agencies. The Natureza greenfield decision, originally targeted for mid-2026, has shifted a few months later due to permitting delays in Rio Grande do Sul, with a board decision now expected in the second half of 2026.

The central investor debate heading into Q2 centers on whether CMPC can demonstrate meaningful leverage reduction while absorbing an unplanned approximately 10-day Guaíba Two boiler stoppage on top of the already-challenging cost quarter. Bulls will watch hardwood price momentum — BHKP reached $575 per ton by quarter-end with a $50 Europe increase announced for May — while bears will focus on the pace of softwood oversupply-driven closures, Brazilian real appreciation lifting costs, and the balance sheet headroom required to eventually fund Natureza.