Suzano S.A. [SUZ] Filings

20-F 1 suz-20231231.htm 20-F suz-20231231

As filed with the Securities and Exchange Commission on April 26, 2024

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 20-F

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended DECEMBER 31, 2023

Commission file number 001-38755


Suzano S.A.
(Exact name of Registrant as specified in its charter)

Suzano Inc.
(Translation of Registrant’s name into English)

Federative Republic of Brazil
(Jurisdiction of incorporation or organization)

Av. Professor Magalhães Neto, 1,752 10th Floor, Rooms 1009, 1010 and 1011 Salvador, Brazil 41810-012
(Address of principal executive offices)

Marcelo Feriozzi Bacci Chief Financial and Investor Relations Officer Telephone: +55 11 3503-9330 Email: ri@suzano.com.br Av. Brigadeiro Faria Lima, 1,355 - 7th Floor São Paulo, Brazil, 01452-919
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Trading Symbol

Name of each exchange on which registered:

Our common shares without par value*

SUZB3/SUZ

New York Stock Exchange*

American Depositary Shares, or ADSs,** each representing one of our common shares

SUZB3/SUZ

New York Stock Exchange

4.000% Notes due 2025, issued by Suzano International Finance B.V.

(successor to Fibria Overseas Finance Ltd.)

FBR/25

New York Stock Exchange

5.500% Notes due 2027, issued by Suzano International Finance B.V.

(successor to Fibria Overseas Finance Ltd.)

FBR/27

New York Stock Exchange

6.000% Notes due 2029, issued by Suzano Austria GmbH

SUZ/29

New York Stock Exchange

5.000% Notes due 2030, issued by Suzano Austria GmbH

SUZ/30

New York Stock Exchange

3.750% Notes due 2031, issued by Suzano Austria GmbH

SUZ/31

New York Stock Exchange

2.500% Notes due 2028, issued by Suzano Austria GmbH

SUZ/28

New York Stock Exchange

3.125% Notes due 2032, issued by Suzano Austria GmbH

SUZ/32

New York Stock Exchange

* Not for trading purposes but only in connection with the registration on the New York Stock Exchange of American Depositary Shares representing those common shares.

** Evidenced by American Depositary Receipts, or ADRs.

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

The number of outstanding shares of stock of Suzano S.A. as of December 31, 2023 was:


1,324,117,615 common shares, without par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☒

No ☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes ☐

No ☒

Note — Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒

No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒

No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒

Accelerated filer ☐

Non-accelerated filer ☐

Emerging growth
company ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

Yes ☒

No ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filling reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b) ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

US GAAP ☐

International Financial Reporting Standards as issued by the International Accounting Standards Board ☒

Other ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17 ☐

Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐

No ☒

Table of Contents

TABLE OF CONTENTS


			Page
FORWARD-LOOKING STATEMENTS			1
GLOSSARY OF CERTAIN TERMS USED IN THIS ANNUAL REPORT			2
PRESENTATION OF FINANCIAL AND OTHER INFORMATION			4
PART I			5
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS			5
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE			5
ITEM 3. KEY INFORMATION			5
A. Financial Data			5
Operational Data			5
Special Note Regarding Non-GAAP Financial M easures			5
B. Capitalization and Indebtedness			7
C. Reasons for the Offer and Use of Proceeds			7
D. Risk Factors			8
Risks Relating to the Pulp and Paper Industry			8
Risks Relating to Our Company			14
Risks Relating to Brazil			21
Risks Relating to Our Shares and ADSs			24
ITEM 4. INFORMATION ON THE COMPANY			29
A. History and Development of the Company			29
B. Business Overview			30
Industry			30
Our Company			33
Seasonality			38
Raw Materials			39
Transportation			40
Port Operations			40
Marketing and Distribution			41
Competition			43
Environmental Matters			43
Brazilian Environmental Regulation			48
Insurance			50
Organizational Structure			51
Property, Plant and Equipment			53
Eucalyptus Planted Forests			53
Plant Locations and Capacity			55
ITEM 4.A. UNRESOLVED STAFF COMMENTS			55
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS			56
Overview			56


			Page
Foreign Currency Impact in Our Operations			56
Pulp Segment			56
Paper Segment			57
Off-Balance Sheet Arrangements			57
A. Operating Results			58
Results of operations			58
Year ended December 31, 2022 compared to year ended December 31, 2021			59
B. Liquidity and Capital Resources			61
Sources and Uses of Funds			61
Operating Activities			62
Investing Activities			62
Financing Activities			62
Capital Expenditures			62
Indebtedness			63
Debt			63
Export Prepayment Agreements (EPP s )			67
Revolving Credit Facility (RCF)			67
Covenants			68
C. Research and development, patents and licenses, etc.			69
Research and Development			69
Intellectual Property			71
Trademarks			71
D. Trend Information			72
E. Critical Accounting Estimates			72
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES			72
A. Directors and Senior Management			72
Board of D irectors			72
Executive Officers			76
Fiscal Council			78
Audit Committee			80
B. Compensation			81
Phantom Shares Plan			83
Share Appreciation Rights Plan			84
Maximum, Minimum and Average Individual Remuneration of our B oard of D irectors, Board of Executive Officers and Fiscal Council			84
Employee C ompensation P olicies			85
C. Board Practices			86
D. Employees			87
E. Share Ownership			87


			i

Table of Contents


			Page
F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation			87
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS			87
A. Major Shareholders			87
Shareholders’ Agreements			88
B. Related-Party Transactions			89
Transactions with Suzano Holding S.A.			89
Other transactions			89
C. Interests of Experts and Counsel			89
ITEM 8. FINANCIAL INFORMATION			89
A. Consolidated Statements and Other Financial Information			89
Legal Proceedings			89
Tax Proceedings			90
Labor Proceedings			92
Civil, Land and Environmental Proceedings			92
Updates on Other Proceedings			95
Dividends			95
B. Significant Changes			97
ITEM 9. THE OFFER AND LISTING			97
A. Offer and Listing Details			97
B. Plan of Distribution			97
C. Markets			97
Trading on the São Paulo Stock Exchange			97
B3 Corporate Governance Standards			98
Significant Differences between our Corporate Governance Practices and NYSE Corporate Governance Standards			100
D. Selling Shareholders			100
E. Dilution			100
F. Expenses of the Issue			100
ITEM 10. ADDITIONAL INFORMATION			100
A. Share Capital			100
B. Memorandum and Articles of Association			100
Voting Rights			101
Shareholders’ Meetings			101
Dividends			101
Acquisition of a Relevant Interest			102
Disclosure of Significant Interest			102
Sale of Control			103
Delisting from the Novo Mercado			103
Delisting as Publicly-Held Company			103
Preemptive Rights			104
Right of Withdrawal			104
Arbitration			105


			Page
C. Material Contracts			106
Financing Agreements			106
D. Exchange Controls			106
E. Taxation			106
Brazilian Tax Considerations			106
U.S. Federal Income Tax Considerations			110
Treatment of our ADSs for U.S. Federal Income Tax Purposes			111
Taxation of Dividends			111
Taxation of Dispositions of our Shares or ADSs			113
Passive Foreign Investment Company Status			114
Foreign Financial Asset Reporting			114
Backup Withholding and Information Reporting			115
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			115
Exchange Rate Risk			116
Sensitivity Analysis – Foreign Exchange Exposure			116
Commodity Price Risk			116
Sensitivity Analysis – Exposure to Commodity Prices			116
Derivatives by Contract Type			116
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES			117
PART II			118
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES			118
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS			118
ITEM 15. CONTROLS AND PROCEDURES			118
ITEM 16. A. AUDIT COMMITTEE FINANCIAL EXPERT			119
ITEM 16. B. CODE OF ETHICS			119
ITEM 16. C. PRINCIPAL ACCOUNTANT FEES AND SERVICES			119
Audit Fees			120
Tax Fees			120
Pre-Approval Policies and Procedures			120
ITEM 16. D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES			120
ITEM 16. F. CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT			123
ITEM 16. G. CORPORATE GOVERNANCE			123
Significant Differences between our Corporate Governance Practices and NYSE Corporate Governance Standards			123
Majority of Independent Directors			123
Executive Sessions			123


			ii

Table of Contents


			Page
Nominating/Corporate Governance Committee			123
Compensation Committee			124
Audit Committee			124
Shareholder Approval of Equity Compensation Plans			124
Corporate Governance Guidelines			124
Code of Business Conduct and Ethics			125
Internal Audit Function			125
ITEM 16. H. MINE SAFETY DISCLOSURE			125
ITEM 16. I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS			125
ITEM 16.J. INSIDER TRADING POLICIES			125
ITEM 16.K. CYBERSECURITY			125
PART III			128
ITEM 17. FINANCIAL STATEMENTS			128
ITEM 18. FINANCIAL STATEMENTS			128
ITEM 19. EXHIBITS			128
SIGNATURES			129


			iii

Table of Contents

FORWARD-LOOKING STATEMENTS

This annual report includes forward-looking statements, mainly in “Item 3. Key Information — D. Risk Factors,” “Item 4. Information on the Company — Business Overview” and “Item 5. Operating and Financial Review and Prospects.” We have based these forward-looking statements largely on our current expectations about future events and financial trends affecting our business. These forward-looking statements are subject to risks, uncertainties and assumptions, including among other things:

•our management and future operation;

•the implementation of our main operational strategies, including our potential participation in acquisitions, joint venture transactions or other investment opportunities;

•general economic, political and business conditions, both in Brazil and in our principal export markets;

•industry trends and the general level of demand for, and change in the market prices of, our products;

•existing and future governmental regulation, including tax, labor, pension and environmental laws and regulations and import tariffs in Brazil and in other markets in which we operate or to which we export our products;

•the competitive nature of the industries in which we operate;

•our level of capitalization, including the levels of our indebtedness and overall leverage;

•the cost and availability of financing;

•our compliance with the covenants contained in the instruments governing our indebtedness;

•the implementation of our financing strategy and capital expenditure plans;

•the impact of the ongoing wars in Ukraine and in the Middle East, the economic sanctions imposed on Russia and their impact on the global economy, which are highly uncertain and difficult to predict;

•inflation and fluctuations in currency exchange rates, including the Brazilian real and the U.S. dollar;

•legal and administrative proceedings to which we are or may become a party;

•the volatility of the prices of the raw materials we sell or purchase to use in our business;

•our ability to comply with our ESG targets and commitments;

•the implementation of new technologies to mitigate operational risks or achieve our ESG targets and commitments;

•other statements included in this annual report that are not historical; and

•other factors or trends affecting our financial condition or results of operations, including those factors identified or discussed in “Item 3. Key Information — D. Risk Factors.”

The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “hope,” “intend,” “may,” “might,” “should,” “would,” “will,” “understand” and similar words are intended to identify forward-looking statements. We undertake no obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise. In light of these risks and uncertainties, forward-looking information, events and circumstances discussed in this annual report might not occur and are not guarantees of future performance. Our actual results and performance may differ substantially from the forward-looking statements included in this annual report.


			1

Table of Contents

GLOSSARY OF CERTAIN TERMS USED IN THIS ANNUAL REPORT

Herein, “Suzano”, the “Company”, “we”, “us” and “our” refer to Suzano and its consolidated subsidiaries, unless the context otherwise requires. References to “Fibria” refer to former “Fibria Celulose S.A.”. All references herein to the “real,” “reais” or “R$” are to the Brazilian real, the official currency of Brazil. All references to “U.S. dollars,” “dollars” or “US$” are to United States dollars, the official currency of the United States.


ABTCP						Brazilian Technical Association of Paper and Pulp, or Associação Brasileira Técnica de Papel e Celulose

ADR						American Depositary Receipts.

ADS						American Depositary Shares.

ANTAQ						Brazilian regulatory agency regulating aquatic transportation, or Agência Nacional de Transportes Aquaviários.

B3						B3 S.A. – Brasil, Bolsa, Balcão, the São Paulo Stock Exchange.

BNDES						The Brazilian Development Bank, or Banco Nacional de Desenvolvimento Econômico e Social.

BNDESPAR						BNDES Participações S.A.

Brazilian Corporation Law						Brazilian Law No. 6,404/76, as amended.