Rising Costs and Climate Mitigation Drag Klabin Net Income Down 18%
Klabin reported an 18% drop in third-quarter 2026 net income to R$ 393 million, as climate mitigation expenses and shipping inflation offset revenue gains.
Brazilian packaging and paper giant Klabin reported a net income of R$ 393 million ($76 million) for the third quarter of 2026, according to its financial results released on October 28, 2026. This represents an 18% drop from the R$ 478 million recorded during the same period in 2025. While net revenue managed a modest 3% year-over-year increase to R$ 5.57 billion, driven by higher US dollar prices for short-fiber pulp and paper, the gains were entirely erased by operational cost inflation and foreign exchange volatility.
The primary drag on the company's profitability came from a sharp rise in production and shipping expenses. Klabin's total cash cost per metric ton jumped 12% year-over-year to R$ 3,483. Management attributed this increase to persistent geopolitical freight pressures affecting global shipping routes, alongside R$ 111 per ton in direct logistics costs spent on mitigating the ongoing effects of the El Niño weather pattern.
These rising outlays severely compressed the company's operating margins. Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) fell 12% year-over-year to R$ 1.86 billion. Consequently, Klabin's adjusted EBITDA margin narrowed to 33% in the third quarter of 2026, down from 39% in the prior-year period.
The margin compression overshadowed a relatively stable operational performance. Klabin's total sales volume remained steady compared to the previous year, supported by the ongoing ramp-up of its new paper machine, PM28, in Paraná. This volume stability helped the company navigate a scheduled maintenance shutdown at its Otacílio Costa industrial unit during the quarter.
Additionally, Klabin's balance sheet showed signs of defensive management. Net debt ended the quarter at R$ 23.98 billion, representing an 8% decrease compared to the third quarter of 2025, keeping leverage stable on a quarter-over-quarter basis. However, with capital expenditures rising 36% to R$ 754 million for the quarter—primarily directed toward forestry and silviculture—the company continues to consume cash to secure its future wood supply.
Market Listing Information
Klabin is a publicly traded company headquartered in São Paulo, Brazil. The company's primary equity listing is on the B3 Brazilian stock exchange, where its unit shares trade under the ticker symbol KLBN11. For international markets, Klabin's shares are also accessible via unsponsored over-the-counter American Depositary Receipts (ADRs) in the United States under the ticker symbol KLBAY.
