Quarterly Release April 28, 2003

January/March 2003

Klabin reports a net profit of R$ 63 million in 1Q03

EBITDA reached R$ 361 million in 1Q03. The EBITDA margin of 42% in a quarter that is seasonally weaker, exceeded the excellent performance at the end of last year, confirming a favorable trend for the Companys businesses. Gross revenue was R$ 980 million in 1Q03. Consolidated net revenue totaled R$ 868 million, supported by rising pulp prices, higher exports and the improvement in the sales margins for packaging products. Net profit amounted to R$ 63 million, reflecting Klabin's excellent operating performance and adjusted debt profile, which is now less exposed to currency exchange rate fluctuations.

March 31, 2003 KLBN4 (BOVESPA) / KLBAY (OTC) Preferred shares ('000) 600,856 Preferred share price Book value Free float Daily traded volume R$ 1.83 R$ 1.25 77% R$ 633 K

Highlights:
Net revenue reaches R$ 868 million. Sales volume expands 3% to 452 thousand tons. Exports reached US$ 102 million. Cash generation amounts to R$ 361 million, with an EBITDA margin of 42%. Net debt/ EBITDA falls to 2.4x.

Quarterly Release April 28, 2003

Initial Considerations
The information presented herewith in connection with the Company's operations and financials consists of consolidated figures stated in local currency as per Brazilian Corporate Law, except where otherwise indicated.

Highlights
R$ Million Sales Volume (1,000 ton) Net Revenue Gross Profit Gross Margin EBIT Net Profit (Loss) EBITDA EBITDA margin (%) Equity Net Debt Total Capitalization Net Debt / EBITDA (annualized) Net Debt / Total Capitalization Depreciation + Amortization Capex 1Q03 452 868 434 50% 276 63 361 42% 1,148 2,806 4,017 2,4 x 70% 85 45 1Q02 441 558 235 42% 104 8 181 33% 1,296 2,487 3,842 3,4 x 65% 77 44 4Q02 491 899 450 50% 279 401 366 41% 1,084 2,821 3,966 2,9 x 71% 87 40 Change Change YoY QoQ 3% (8%) 56% (3%) 84% (4%) 166% 0% 99% (1%) 0% (1%)

13%

(1%)

10% 2%

(2%) 13%

Economic and Financial Performance

Sales Volume and Net Revenue
Sales volume, excluding wood, increased 3% to 452 thousand tons in 1Q03 compared to 1Q02. In relation to 4Q02, it declined 8% due to seasonal effects in the first quarter of the year, particularly in the packaging segment. Net revenue reached R$ 868 million in 1Q03, up 56% from 1Q02 but down 3% from R$ 899 million in 4Q02. Net revenue growth can be attributed to a steady improvement in prices despite a poorer demand for corrugated boxes. Furthermore, it reflects a recovery in international pulp prices, coupled with the positive effect of currency devaluation on export revenues.

Quarterly Release April 28, 2003

Operating Result
Gross profit totaled R$ 434 million, up 84% from 1Q02 thanks to more favorable prices, higher sales volumes and a tight control over production costs. Gross margins amounted to 50% compared to 42% in 1Q02. Operating result before net financial expenses (EBIT) reached R$ 276 million in 1Q03 against R$ 104 million 1Q02. Operating margins expanded from 19% to 32%, mainly due to the increase in gross profit, coupled with lower general and administrative expenses. Higher export volumes (45% of total sales volume in 1Q03 versus 41% in 1Q02) caused dollar-denominated freight expenses to rise to R$ 62 million, as compared to R$ 47 million in 1Q02.

EBITDA
Although business in the first R$ Million quarter is typically slower due to seasonal effects, EBITDA in 1Q03 gave continuity to the rising trend 400 observed in 4Q02, totaling R$ 361 33 300 million, i.e. up 99% from 1Q02 and 1% down from 4Q02. EBITDA 200 margin climbed to 42%, above the 100 181 level attained in 4Q02, thanks to 0 growing revenues and successful 1Q02 efforts towards operating cost efficiency.
EBITDA Margin 41 29 34
366 169 2Q02
EBITDA

42

50% 40% 30%

361

262

20% 10% 0%

3Q02

4Q02

1Q03

EBITDA Margin

Below is the Company's cash generation (EBITDA) by business line over the period. The packaging segment includes packaging paper, corrugated boxes and multiwall bags (Brazil).

EBITDA per business segment

R$ Million
Packaging Forestry Market Pulp Dissolving Pulp Tissue Brazil Tissue Argentina Sacks Argentina Newsprint Corporate Expenses / Intercompany Consolidated

1Q02 126 33 26 10 3 1 1 1 (20) 181

2Q02 127 36 21 7 (1) 1 2 (1) (22) 169

3Q02 170 40 57 16 5 1 1 0 (27) 262

4Q02 257 46 75 15 5 0 1 0 (34) 366

2002 680 155 179 49 12 3 6 0 (104) 979

1Q03 249 57 74 13 6 1 1 (15) (24) 361

Quarterly Release April 28, 2003

Financial Result and Indebtedness

Net financial expenses totaled R$ 176 million in 1Q03 versus R$ 91 million in 1Q02. Net exchange variations reached R$ 16 million (9% of the total amount), now that the Company is less exposed to currency variations. Gross debt fell from R$ 2,941 million in December 2002 to R$ 2,922 in March 2003. Forty-three per cent (43%) of this amount refers to long-term contracts with maturity dates extending to 2010. Foreign currency debt represents 33% of Klabin's total indebtedness. Fifty-nine per cent (59%) of this amount refers to trade finance.
Debt - Consolidated
R$ million 12/31/2002 Currency Local Foreign 899 1,028 1,927 719 295 1,014 3/31/2003 Currency Local Foreign 968 988 1,955 688 278 966

Total 1,618 1,323 2,941 (120) 2,821

Total 1,656 1,266 2,922 (115) 2,806

Short Term Long Term GROSS DEBT Cash and Short Term Investments NET DEBT

Net debt at the end of 1Q03 amounted to R$ 2,806 million or 70% of total capitalization, versus 71% in 4Q02. Higher cash generation improved the Company's net debt/EBITDA ratio from 3.4x in 1Q02 to 2.4x in 1Q03, as compared to 2.9x in 4Q02. Having changed its debt profile and dramatically reduced its exposure to foreign currency variations, Klabin adjusted its hedge position, as shown in the table below: Hedge Strategy 03/31/03 Foreign Currency Debt Trade Finance - Natural Hedge Hedge Operations Exposure US$ Million 288 (171) (116) 1

Net Result
Klabin reported a net profit of R$ 63 million in 1Q03, reflecting an excellent operating performance.
4

Quarterly Release April 28, 2003

Business Performance
Volume 1Q03
Sacks/ Newsprint Envelopes 7% 6% Corrugated Market Pulp Boxes 15% 21% Tissue 9% Others 1% Packaging Paper 35% Printing/ Writing 2% Dissolving Pulp 4%

Net Revenue 1Q03

Newsprint 5% Market Pulp 10% Others 2% Tissue 17% Wood 6% Sacks/ Envelopes 8% Corrugated Boxes 20%

Printing/ Writing 2% Dissolving Pulp Packaging 4% Paper 26%

(*) Sales volume figures do not include wood

(*) Net Revenue consolidated 100% Net revenue does include wood

Packaging Paper Sales volume totaled 158 thousand tons in 1Q03, up 5% from 1Q02, while net revenue advanced 59% to R$ 255 million. This positive performance in terms of revenue resulted from the attainment of a new threshold in packaging paper exports, with Klabin's entry into new markets, aided by a stronger U.S. dollar over the period. A highlight in this business segment is the adaptation of machine # 6, previously used to produce newsprint, for the manufacture of packaging paper products, most of which for the export market. The effects of this change will therefore be felt in 2Q03 results. Corrugated Boxes Although the first quarter of the year is generally a low season for corrugated boxes sales, they took longer than usual to bounce back in 2003 because inventories at major customers remained high and consumption declined more than projected. Consequently, sales volume totaled 94 thousand tons in 1Q03, down 22% from 1Q02. As per ABPO, corrugated boxes shipments in Brazil decreased by approximately 9% over the same period. Net revenue reached R$ 193 million, up 36% from 1Q02 due to price stability. Multiwall Bags Sales volume expanded 3% to 28 thousand tons when compared to 1Q02. A slight decline in the building and food packaging industry prevented Klabin from selling more multiwall bags. However, higher exports and favorable international prices helped to increase net revenue by 62% to R$ 80 million in 1Q03.

Quarterly Release April 28, 2003

Market Pulp Favorable market conditions due to a reduction in NORSCAN's inventories pushed international pulp prices up and benefited Klabin's performance in this segment. In 1Q03, the market pulp mill at Guaba (RS) operated at 95% of its installed capacity. Thus, sales to third parties reached 66 thousand tons in 1Q03, up 28% from 1Q02 and 3% from 4Q02. Net revenue jumped 121% to R$ 100 million when compared to 1Q02 as the result of higher sales and prices. Dissolving Pulp Due to the annual downtime for maintenance and operational adjustments, dissolving pulp sales slipped 4% to 20 thousand tons in 1Q03 as compared to 1Q02. On the other hand, sales revenue climbed 41% to R$ 35 million, thanks to more favorable prices. Tissue Higher exports, particularly of jumbo rolls, raised sales volume by 13% to 41 thousand tons, and net revenue by 63% to R$ 168 million in 1Q03, compared to 1Q02. Newsprint Sales totaled 33 thousand in 1Q03, generating net revenue of R$ 45 million. As already anticipated, Klabin terminated its joint venture with Norske Skog at the end of March. Machine # 6 was therefore adapted for the production of packaging paper. Printing & Writing Paper In 1Q03, printing & writing paper sales remained flat at 6 thousand tons when compared to 1Q02. However, net revenue improved 53% to R$ 16 million on account of price adjustments in this segment. Wood Klabin sold 655 thousand tons of pinus and eucalyptus logs to third parties in 1Q03, up 21% from the volume reported in 1Q02. Influenced by currency variations throughout the year and adverse climatic conditions in the northern hemisphere, with significant effects on lumber prices, net revenue grew 61% to R$ 55 million. Sales by Market Export volumes rose 13% to 203 thousand tons in 1Q03. Their share in total sales increased from 41% in 1Q02 to 45% in 1Q03.

Sales Volume by Market

Net Revenue by Market

45%

41%

37%

31%

55%

59%

63%

69%

1Q03

1Q02

1Q03 Domestic Market

1Q02 Exports

Domestic Market

Exports

(*) Sales volume figures do not include wood

(*) Net Revenue consolidated 100% Net revenue does include wood

Quarterly Release April 28, 2003

Attendant to a strategy implemented by Klabin, export revenues expanded dramatically to R$ 355 million in 1Q03, up 85% from 1Q02. As a result, the share of exports in total net revenue rose from 31% in 1Q02 to 37% in 1Q03. Exports generated US$ 102 million in 1Q03 versus US$ 80 million in 1Q02. Packaging paper sales accounted for US$ 41 million of this amount, while market pulp contributed with US$ 28 million, tissue with US$ 14 million, dissolving pulp with US$ 10 million, multiwall bags with US$ 5 million, and other products with US$ 4 million. Exports should continue growing throughout the year 2003, favored by higher production of market pulp at Guaba (RS) and as machine # 6 at Monte Alegre (PR) begins to manufacture packaging paper, mainly for the export market.

Capital Expenditures
Klabin invested R$ 45 million in 1Q03, R$ 14 million of which in the recycling plant at Correia Pinto (SC) and R$ 8 million in market pulp operations at Guaba (RS). R$ 5 million were disbursed in the revamping of machine # 6 (MP6) for the production of packaging paper.

Capital Markets
Klabin's preferred shares (KLBN4) ended the trading session held on March 31, 2003 quoted at R$ 1.83. In 1Q03, they climbed 78% while the So Paulo Stock Exchange Index (Ibovespa) remained level at approximately 11,270 points.Klabin is part of the Ibovespa and it has adhered to Level I Corporate Governance practices prescribed by the So Paulo Stock Exchange (Bovespa). In 1Q03, 27.2 million KLBN4 shares were traded in 3,632 transactions, with an average daily traded volume of R$ 633 thousand.
KLBN4 vs.Ibovespa - 12 months Closing Price: 3/31/02 = 100
160 140

Klabin
120 100 80 60 40
3 3 3 2 2 2 2 2 2 2 2 2 00 00 00 00 00 00 00 00 00 00 00 00 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 /1 2 1 3 9 8 7 6 5 4 12 11 10

Ibovespa

Quarterly Release April 28, 2003

For further information, please contact:

Ronald Seckelmann, Financial and IR Director Luiz Marciano Candalaft, IR Manager Tel: (11) 3225-4045 Email: invest@klabin.com.br Paulo Roberto Esteves Tel: (11) 3848-0887 ext.: 205 Email: paulo.esteves@thomsonir.com.br

With a gross revenue of R$ 3.2 billion in 2002, Klabin is the largest integrated pulp & paper mill in Brazil, capable of selling up to 2 million tons of products per year. For strategic reasons, the Company has decided to focus on the following market segments: packaging paper, cardboard, corrugated boxes, multiwall bags, tissue paper, timber and pulp. Klabin leads most of the business markets where it operates.
The statements contained herein with regard to the Company's business prospects, operating and financial result projections, and references to its potential growth are merely forecasts based on the expectations of Company Management in relation to its future performance. Such estimates are highly dependent on market behavior and on Brazilian economic, industry and international market conditions. They are therefore subject to change. 8

Attachment 1 Consolidated Income Statement Brazilian Corporate Law (Thousand of R$)

1Q03
Net Revenue Cost of Products Sold Gross Profit Selling Expenses General & Administrative Expenses Other Revenues (Expenses) Total Operating Expenses Operating Profit (before Fin. Results) Equity in net profit (loss) of subsidiaries Financial Expenses Net Foreign Exchange Losses Financial Revenues Net Financial Expenses Operating Profit Non Operating Revenues (Expenses) Net Profit (Loss) before Taxes Income Tax and Soc. Contrib. Minority Interest Net Profit (Loss) Amortization Depreciation EBITDA 868,479 (434,818) 433,661 (113,981) (35,907) (7,617) (157,505) 276,156 (67) (171,505) (16,127) 11,843 (175,789) 100,300 1,268 101,568 (37,520) (840) 63,208 65,362 19,653 361,171

1Q02
558,019 (322,941) 235,078 (77,406) (40,133) (13,543) (131,082) 103,996 175 (76,878) (21,409) 6,937 (91,350) 12,821 (3,898) 8,923 (1,062) (223) 7,638 57,579 19,843 181,418

4Q02
898,905 (448,908) 449,997 (111,927) (40,839) (17,978) (170,744) 279,253 (1,197) (109,670) 108,031 9,702 8,063 286,119 (9,868) 276,251 125,568 (1,135) 400,684 65,508 21,339 366,100

Change YoY
55.6% 34.6% 84.5% 47.3% (10.5%) (43.8%) 20.2% 165.5% (138.3%) 123.1%

Change QoQ
(3.4%) (3.1%) (3.6%) 1.8% (12.1%) (57.6%) (7.8%) (1.1%) (94.4%) 56.4%

% of Net Revenue 1Q03 1Q02 4Q02

100.0 50.1 49.9 13.1 4.1 0.9 18.1 31.8 19.7 1.9 1.4 20.2 11.5 0.1 11.7 4.3 0.1 7.3 100.0 57.9 42.1 13.9 7.2 2.4 23.5 18.6 0.0 13.8 3.8 1.2 16.4 2.3 0.7 1.6 0.2 0.0 1.4 10.3 3.6 32.5 100.0 49.9 50.1 12.5 4.5 2.0 19.0 31.1 0.0 12.2 12.0 1.1 0.9 31.8 1.1 30.7 14.0 0.1 44.6 7.3 2.4 40.7

13.5% (1.0%) 99.1%

(0.2%) (7.9%) (1.3%)

7.5 2.3 41.6

Attachment 2 Consolidated Balance Sheet Brazilian Corporate Law (Thousand of R$)

Assets
Current Assets Cash and banks Short-term investments Receivables Inventories Recoverable taxes and contributions Other receivables 3/31/2003 1,139,020 64,736 50,645 550,329 318,261 104,104 50,945 12/31/2002 1,021,844 60,952 58,871 473,035 291,805 90,016 47,165

Liabilities and Stockholders' Equity

Current Liabilities Loans and financing Debentures Suppliers Income tax and social contribution Taxes payable Payroll provisions Other accounts payable Long-Term Liabilities Loans and financing Debentures Other accounts payable Results for Future Fiscal Years Minority Interests Stockholders' Equity Capital Capital reserves Revaluation reserve Treasury stock / Profit reserve Total

3/31/2003 2,096,448 1,131,503 524,206 246,042 38,928 30,727 43,169 81,873 1,521,739 701,849 564,000 255,890 0 62,853 1,147,852 800,000 194,892 93,262 63,563 4,828,892

12/31/2002 2,031,405 1,135,431 482,705 231,842 3,788 32,510 56,133 88,996 1,566,618 758,566 564,000 244,052 2,605 61,733 1,083,566 800,000 193,632 93,799 0 4,745,927

Long-Term Receivables Deferred income tax and soc. contrib. Taxes to compensate Recoverable taxes Other receivables Permanent Assets Other investments Property, plant & equipment, net Deferred charges

482,604 282,186 26,072 130,588 43,758 3,207,268 68,564 2,904,027 234,677

480,342 281,457 25,151 120,254 53,480 3,243,741 70,225 2,921,101 252,415

Total

4,828,892

4,745,927

10

Attachment 3 Domestic Market (Consolidated 100%)

1Q03 Sales Volume (1,000 ton) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood Volume (1,000 ton) Net Revenue (R$ million) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood 250 33 5 62 26 2 0 93 22 6 655 610 45 13 111 117 2 0 189 61 16 55 1Q02 261 23 6 53 28 3 0 121 23 5 497 419 28 10 71 83 2 0 140 43 14 29 4Q02 283 28 7 73 27 2 0 116 24 7 628 610 38 15 113 113 1 1 211 54 17 48 Change YoY (4.5%) 41.2% (8.5%) 16.1% (4.8%) (19.9%) (10.7%) (22.8%) (7.7%) 34.9% 31.7% 45.4% 64.8% 29.1% 56.6% 41.0% 10.8% (0.4%) 35.0% 42.1% 21.5% 86.7% Change QoQ (12.0%) 17.3% (23.1%) (14.9%) (3.1%) 38.5% (27.1%) (19.9%) (7.9%) (14.4%) 4.3% 0.0% 19.1% (14.5%) (1.5%) 4.0% 125.1% (22.1%) (10.4%) 13.6% (3.3%) 13.6%

11

Attachment 4 Exports (Consolidated 100%)

1Q03 Sales Volume (1,000 ton) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood Volume (1,000 ton) Net Revenue (R$ million) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood 355 3 144 51 98 34 4 19 2 0 203 1 96 15 64 20 1 6 0 1Q02 179 0 96 9 49 20 1 3 0 44 192 1 90 20 44 24 2 6 1 5 4Q02 207 1 100 11 62 27 0 6 0 31 377 3 160 43 97 48 1 19 1 4 466.9% 60.2% 155.0% 125.4% 41.8% 120.8% 199.1% 145.5% 3.2% (10.1%) 18.1% 1.3% (28.4%) 289.1% (1.0%) 32.4% 85.4% (5.8%) (0.6%) 70.4% 30.3% (3.7%) 0.0% 81.3% (3.7%) 31.7% 2.6% (26.7%) 0.0% 1.3% Change YoY 13.2% Change QoQ (2.1%)

12

Attachment 5 Total Sales (Consolidated 100%)

1Q03 Sales Volume (1,000 ton) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood Volume (1,000 ton) Net Revenue (R$ million) Newsprint Printing and Writing Paper Packaging Paper Tissue Market Pulp Dissolving Pulp Corrugated Boxes Sacks/Envelopes Others Wood 452 33 6 158 41 66 20 94 28 7 655 965 45 16 255 168 100 35 193 80 18 55 1Q02 441 23 6 150 36 52 21 121 27 5 541 611 28 10 161 103 45 25 142 49 14 34 4Q02 491 28 8 172 38 64 27 116 29 8 658 987 38 18 273 156 98 48 212 73 18 53 Change YoY 2.7% 41.2% 8.3% 5.3% 13.0% 27.7% (3.9%) (22.2%) 3.1% 35.9% 21.1% 58.0% 64.8% 52.7% 58.6% 62.9% 121.0% 41.0% 36.2% 62.0% 28.0% 61.4% Change QoQ (7.8%) 17.3% (18.1%) (8.4%) 6.9% 3.5% (26.7%) (18.9%) (6.1%) (13.8%) (0.6%) 2.2% (16.0%) 12.9% 7.0% (7.3%) (2.3%) 39.5% 9.8% (8.9%) 0.6% (3.8%)

13

Attachment 6
Financing Repayment Schedule 03/31/03
Total Debt - Average Tenor: 15 months
R$ Million 2Q03 3Q03 4Q03 1Q04 2Q04 2H04 2005 2006 onwards TOTAL Currency Local Foreign TOTAL

322 67 531 47 34 62 681 211 1,955

289 242 77 79 95 171 53 (41) 966

611 310 609 126 129 233 734 170 2,922

Local Currency Average Tenor: 19 months Average Cost 26.3% per year
R$ Million 2Q03 3Q03 4Q03 1Q04 2Q04 2H04 2005 2006 onwards TOTAL BNDES Debentures Others TOTAL

60 39 34 33 32 62 115 209 584

52 472 564 1,088

210 28 25 14 2 1 2 2 283

322 67 531 47 34 62 681 211 1,955

Foreign Currency Average Tenor: 7 months Average Cost 8.5% per year
US$ Million 2Q03 3Q03 4Q03 1Q04 2Q04 2H04 2005 2006 onwards TOTAL Trade Finance Eurobonds Others TOTAL

36 36 18 22 26 24 9 171

0.4 23 23

50 37 5 2 3 4 7 (12) 94

86 72 23 24 28 51 16 (12) 288
14

Attachment 7
Consolidated Cash Flow Statement
period ended 03/31/03
Operating Activities Net profit for the period Expenses (revenues) not affecting working capital: Depreciation, amortization and depletion Amortization of goodwill Gain (Loss) on sale of property, plant and equipment Impaiment for losses on fixed assets Deferred income tax and social contribution Income tax and social contribution charges Interest and exchange rate variations on loans and financings Equity in losses of subsidiaries Exchange rate variations on investments abroad Minority Interest Redution (increase) in Assets Cash and cash equivalents Accounts receivable Inventories Taxes recoverable Prepaid Expenses Judicial Deposits Others accounts receivable Increase (reduction) in Liabilities Suppliers Taxes payable Provision for income tax and social contribution Salaries, vacation pay and payroll charges Provision for contingencies Deferred income Others accounts payable Net cash provided from operating activities Investing activities Acquisitions of property, plant and equipment Increase in deferred assets Proceeds from disposals of property, plant and equipment Loans to related parties Other investments, net Net cash used on investing activities Financing activities: New funding Loan amortization Interest paid Net cash used in financing activities Net increase in cash and equivalents Cash and cash equivalent at beggining of period Cash and cash equivalent at end of period Thousand of Reais 63,208 84,347 1,484 (1,278) (4) 1,043 36,477 129,795 67 9,604 838 3,445 (77,294) (26,456) (17,127) 12,015 (5) (6,071) 14,417 (1,783) 23 (12,964) 15,642 (2,605) (26,659) 200,159 (41,481) (2,966) 1,442 5,533 108 (37,364) 247,161 (313,278) (97,675) (163,792) (997) 75,428 74,431 (997)

15