Good morning, ladies and gentlemen. Welcome to the webcast for the Q1 of 2021 results. Participating in the call today are the following members of the board, António Redondo, Adriano Silveira, João Lé, Fernando Rui, and Nuno Santos. As usual, we'll start with a brief presentation of the main highlights of the period, and we'll have a Q&A session at the end. Presentation can be accessed through the link available on the website, and questions may be addressed also to the webcast platform. António will start with a comment on the main figures recorded in this period. António, please.
Good morning, and thank you for joining us today. I will start by going to slide four and make a global overview on Q1 2021. The quarter was marked by the new lockdowns we collected most of the key markets, and the pace of paper demand remained at the same level as it was in the Q4 of 2020. These prices for pulp recovered strongly over the period and successive price increases were implemented, and number of price increase increments of paper also announced. We have certainly anticipate our model of 2020 mental stops at the end of Q1, impacting the pulp and paper mills in a period of 11 days shutdown and the slow start that computed a total of about 13 days shutdown.
This had, of course, an impact on the available output for sales and volumes of pulp, paper, and energy, which declined versus Q4 2020 and versus Q1 2020 as well. Tissue business progressed well in the quarter, in spite of the impact of lockdowns and travel restrictions continuing to affect the away-from-home segment. We kept our efforts to contain costs, both fixed and variable, and ended the quarter with some relevant savings. We registered an EBITDA margin of EUR 71 million and reached an EBITDA sales ratio of 21%. We maintained the careful management of our working capital and ended the quarter with a strong generation of free cash flow. We finished the construction of our solar plant at Figueira da Foz with an annual installed capacity of 2.6 MW, increasing the energy generation through renewable sources and going one step further in our decarbonization roadmap.
We also present our new 2030 sustainability agenda and responsible business management agenda, which seeks to increase the company's positive contribution to creating value and sustainable growth in a changing world. This agenda is fully aligned with our purpose of commitment to creating sustainable value for our shareholders and for society as a whole. Let's go now to slide number five, please, with the overview of the main figures for the quarter. Turnover stood at EUR 341 million, in line with Q4 2020 and 16% below Q1 2021. This year-on-year evolution was mainly due to the reduction in paper and pulp volumes and the lower sales price for paper. EBITDA reached EUR 71 million, 6% below Q4 2020 and 20% lower than a year ago. CapEx stood at EUR 20 million, EUR 9 million above Q4 and EUR 3 million under Q1 2020.
Adriano Silveira will comment on the CapEx plan, but this included mainly maintenance and environment and decarbonization costs. Strong free cash flow registered in the quarter, as just mentioned previously, of EUR 56 million, comparing very favorably with EUR 15 million registered in Q1 2020. Net debt stood at EUR 624 million at the end of the quarter, and net debt to EBITDA ratio improved slightly to 2.33 x from year end. We turn to slide six, we have an overview of the evolution of the last six quarters. In terms of production output and sales for paper and pulp, Q1 2020 is clearly impacted by the lockdown restrictions and by planned maintenance stoppages that took place in March and that implied about 13 days of downtime are common to this year.
Maintenance at paper mill of Figueira da Foz occurs every 18 months, so the last equivalent downtime was in Q3 2019. The maintenance stoppages in Setúbal and Aveiro took place in Q2 2020, and we have planned the 2021 stoppages to Aveiro during Q3. Tissue outputs remain solid and comparable to previous quarters. The decline in pulp and paper volume was partially offset by the improvement in average selling price, namely in pulps. Financial figures in Q1 reflect a stabilization versus the preceding quarters in terms of turnover and EBITDA. The comparison with Q1 2020 is of course material, as that period was only impacted by the COVID-19 difficulties at the very end. I'll ask now for Fernando to comment on the EBITDA evolution. Fernando, please.
Thank you, António. Turning to slide seven, we can take a closer look at the main impact of EBITDA on a year-on-year comparison. As mentioned, COVID lockdowns and planned production stoppage had a negative impact on the top line of Q1 2021. Declining volumes for pulp and paper had a negative effect of EUR 9 million. The greatest impact came from prices, with the overall effect EUR 29 million. The benchmarking index logged 6.4%, Navigator average price was also negatively influenced by the Euro-U.S. dollar exchange rate, 25% negative impact, and geographical and product mix. These two negative impacts of prices and volumes were partially offset by the positive evaluation in fixed and variable costs in a global amount of EUR 80 million.
Variable costs were positively impacted by the reduction in energy costs due to the savings registered with the new biomass boiler at Figueira da Foz mill, namely related to reduced consumption of natural gas. Price of natural gas was lower. Lower costs with chemicals, especially due to lower prices. Positive evolution of wood costs, mainly in terms of specific consumption. This was quite visible at 2Mill, where specific consumption improved from 3.1 m³ /t - 2.93 m ³/t . Exchange rates also impact wood cost. The stronger euro versus U.S. dollar impact positively on supply of wood from externally varying markets. Fixed costs also evolved positively, improving 9% year-on-year, especially in functional costs. Turning to slide eight with the quarter-over-quarter comparison, EBITDA figures are more aligned, reflecting a similar demand context, both impacted by COVID-19 restrictions.
In terms of prices, global impact is clearly positive with an improving pulp, which sustained a special recovery in paper price as well. Still, volumes for paper and pulp impact negatively in EBITDA. Costs involved also positively during the quarter and had a positive contribution. Variable cost factors such as energy and chemicals performed well, and we also achieved significant savings in fixed costs, mainly functional costs. Also noteworthy is the revaluation of biologic assets, mainly in Mozambique, in Q4 2020, which impact in the period by around EUR 10 million in liquid terms. I will now ask Nuno Santos to comment on the next slide. Nuno, please.
Thank you, Fernando. Let's take a look at pulp and paper prices during the quarter on slide 10. The recovery in pulp prices is very steep and occurred in a short period of time. The current level is similar with the one registered at the beginning of 2018, at around EUR 840 per ton, climbing EUR 290 per ton. The increase in pulp prices has given support to an improvement in paper prices, but the index still shows a modest increment as it is backwards looking and is usually a delay regarding pulp. Paper index has risen EUR 15 per ton from beginning of the year until May 25 to EUR 824 per ton, but is still below the average for 2020 of EUR 836 per ton. On slide 11, we have an update on the pulp market.
After proving to be particularly resilient in 2020, with short fiber growing by 6%, the global pulp market showed a strong price recovery in 2021, with several increases. Hardwood pulp in dollars in China was up by around 46% in the first three months of the year, up $230 per ton, and rose 29% in Europe, up from $680 per ton to $876 per ton, up 34% in euros. Of course, these prices are at the end of the quarter. Today, risk prices, fixing Europe are above $1,000 or at EUR 842 per ton and at $770 in China. Considering that China prices are net and those in Europe are gross before discounts, we see that there is still room for price convergence between Europe and China over the course of the Q2.
The improvement in prices was sustained by a wide range of factors, among which we may point to macroeconomic aspects as well as others more closely related to the industry. Regarding the more global factors, stimulus measures for the global economy and the strong recovery of the Chinese economy fueled an upward cycle in commodities. World exchange rate trend, appreciation of the Chinese yuan and euro against the dollar also sustained higher prices in dollars. In what relates to the specifics of the industry, the strong recovery in pulp demand, which already started in late 2020, in particular in China, driven by global increase in tissue consumption, a robust printing and writing demand, especially for uncoated free paper, and by demand for carton board made from virgin fiber, ivory board.
Also significant was the wide price gap between long and short fiber, which pushed hardwood pulp prices up and also the decline worldwide in availability of recycled fibers. On the supply side, low stocks in the supply chain, several planned and unplanned production stoppages with longer than usual maintenance shutdowns as a result of pandemic-related restrictions, and the conversion of some short fiber pulp capacity to the dissolving pulp combined to constrain the amount of hardwood pulp available on the market. Another constraining factor on the availability of pulp is related to logistical issues. Currently, there is still a gap between pulp prices in Europe and China. Very recently there were some new price increases announced for Europe for June from major pulp producers, announcements that aim to reduce that gap. These announcements put the prices at $1,140 for next month, more than $100 from today's fix.
Ant ó nio will now comment on the paper market. Ant ó nio, please.
Thank you, Nuno. On slide 12, we have summarized some of the main developments in UWF. Global demand for printing and writing papers fell by around 8% year- to- date March, with UWF paper showing a reduction of 5%, more favorable than for coated papers and mechanical papers once again. In Europe, demand for UWF paper during the Q1 evolved along similar lines, now 9%, improving in April to a year to date of -4%, with apparent demand up 16% in April. In the U.S., demand for UWF dropped by approximately 14% in the first three months of the year. The demand evolution and capacity reduction of around 15% allow for a recovery in the capacity utilization rate, up from 83% in January to about 88% in March.
In terms of balance between demand and supply, North American producers have been reducing their N3 capacity and shutting down in the order of 1.8 million tons net between 2019 and 2021, 26% of all U.S. capacity. Also in Europe, other closures were recently announced, which will take around 8% of European capacity in 2021. These shutdowns are creating positive pressure on the balance between paper supply and demand. Looking a little closer at the market condition in Europe on slide 13, please, we wanted to share some visibility on the market evolution until April, as the first three months of 2021 were impacted by new surges in COVID-19 infections and the subsequent lockdowns, versus at the end of 2020, where the economic impact of the pandemic was only felt towards the end of the Q1.
Apparent consumption in March and April improved significantly over the 12 preceding months, with March only -1% and April increasing to 16%. Year-to-date April declined to 3.9%, as mentioned previously. Navigator has been registering increases in its order book from 33 days in January to about 57 days in March, counting with orders not yet confirmed, and industry orders have also been improving over the last month, albeit at a slower rate when compared to Navigator. If we go to slide 14, we have a closer view of the group's paper and pulp performance. As already mentioned, Navigator decided to bring forward to the Q1 the annual maintenance shutdowns for the pulp mill and for paper machines at three of the four sites.
Paper sales totaled 335,000 tons in the first period, down by 8.4% in relation to the same period in the previous year and 2% vis-à-vis Q4 2020. The value of N3 sales was affected by both the lower volumes and the reduction in global paper prices. Navigator's average sales price was also highly penalized by the evolution of exchange rates, a negative impact of 25% year-on-year. Navigator's products and markets mix reflected the pandemic situation in Europe. There was a strong recovery in demand and prices in overseas markets, where prices were up in comparison with the last quarter of 2020. Paper turnover remained stable versus Q4 but was 18.5% lower year-on-year. Until the end of March, we registered an order group, as I mentioned before, was 57 days, and this order group has been kept during the last few months.
Our inventories were kept at low levels throughout the quarter, dropping to 13 days at the end of March. Although it compares favorably with our competitors, with stocks estimated at 31 days, our low stock policy did not allow us, as was the case in Q1 2020, to earn more sales volumes from stock valuation. I will ask Nuno to comment on the pulp business performance. Nuno, please.
In terms of pulp performance, sales were also impacted by the decrease in pulp available for sale due to both the production stoppage already mentioned and the very low level of inventories at the start of the year. Total sales volume in Q1 was 79,000 tons, 5.5% lower than in Q1 2020 and 19% lower than in Q4 2020. The recovery in pulp prices observed since the start of the year helped to mitigate a decline in sales volumes, with sales value showing an increase of 2% year-on-year, but a decline of 6.4% quarter-on-quarter. Sales in Europe were up in 2021 versus last year, with growth in the decor segment and UWF and a reduction in specialties and tissue. Let's take a look at the tissue performance on slide 15.
The tissue market felt the effects of travel restrictions imposed again early in the year, especially in the away-from-home segment, with the delayed reopening economies and the consequent impact on the HoReCa channel and the return to work at the office. As vaccination programs gather speed and the prospects for a return to a degree of normality improve, the at-home sector registered some destocking as households run down inventory, especially when compared with the same period in the previous year. It is now expected a gradual rebound in the away-from-home segment. Despite this context, Navigator Sales continued the good performance recorded over the previous year and stood at 27,000 tons, up by around 4% year-on-year and in line with the final quarter of 2020.
The average sales price was around 4% lower than one year previously, due essentially to the share of reel in the sales mix, given that sales prices for finished goods were up positively. Sales were therefore in line with the Q1 last year and down 2.7% on the Q4. Navigator showed an increase in the weight of the at-home sales from a year ago, with this segment representing almost 60% of sales versus 60% then. In terms of geographic mix, the weight of sale in Portugal increased to 44%, with Spanish market remaining stable at 36%. Adriano will comment on the CapEx now. Adriano, please.
Thank you, Nuno. On slide 16, we have an overview of the CapEx over the quarter. CapEx totaled EUR 20 million, an amount slightly below the Q1 of 2020, but clearly higher than the Q1 2020. This amount includes approximately EUR 14 million of maintenance and obsolete asset replacement, including the new wood chip pile in Aveiro, and EUR 6 million in environmental and decarbonization projects, of which a significant part is still associated with the biomass boiler in Figueira da Foz, and also the solar plant also in Figueira da Foz. The new solar plant in Setúbal mill is under construction. Now, we would like to give you a very brief overview of our new 2030 sustainability agenda presented in our annual sustainability report, summarized on slide 17, and I will ask João Lé to comment.
Thank you, Adriano. This agenda was designed on the basis of the findings obtained in wide-ranging stakeholders engagement process and the work already carried out by Navigator in the field of sustainability. With the ambition of generating a positive impact for people and the planet, through its business, the 2030 Agenda comprises one central focus and three strategic action areas, which are aligned with the company's purpose and values, which include the commitment to creating sustainable value for our shareholders and for society as a whole. The central focus area, a responsible business, is relevant to all sectors and informs all areas of strategy. This includes topics such as ethics, risk management, and value creation, as well as innovation. The three strategic action areas seek to bring together the material topics on which the company has previously focused, and which are reaffirmed even more ambitiously for the coming decade.
These are nature, climate, and society. A set of 14 commitments have been established in the 2030 roadmap in collaboration with the various operational sectors. From 2021 onwards, we will report our performance on each of the 14 commitments in accordance with the goals defined and with the key performance indicators. I invite you to take a look at our sustainability report available on our website. Turning to slide 18, we wanted to make a quick reference to our most recent investment in the solar energy area, as we concluded during Q1, the construction of the solar plant at Figueira da Foz. This plant represents The Navigator Company's fourth investment in solar energy, with the company investing globally over EUR 5 million in the installation of 7,200 solar panels, with an area of approximately 28,500 sq m.
With a capacity of 2.6 MW and composed by 7,700 solar panels, the new solar plant is now the largest within the group, exceeding the one in Setúbal with 2.2 MW capacity. This new plant will increase the generation of electrical renewable energy with zero CO2 emissions and will allow to further avoid emissions in alignment with our decarbonization roadmap. I will ask Fernando to make the next comments. Fernando, please.
Thank you, João. On slide 19, we have an overview of free cash flow in Q1. Navigator demonstrated once again a strong cash flow generation capacity. Free cash flow totaled EUR 56 million, comparing very favorably with the same period in 2020, EUR 15 million at the time. It should be noted that Navigator's cash generation cycle normally presents very moderate levels in the Q1. In the Q4 of 2020, free cash flow stood at EUR 63.1 million. Despite the gradual upturn in activity levels accompanied by a slight increase in stock levels, especially in raw materials and clients, the continued lower level of investment in working capital has been crucial to the healthy level of free cash flow.
Effective management of working capital, in which a careful policy of supplier management is combined with offered our partner solutions for supporting their liquidity, therefore remains a cornerstone of the process of managing free cash flow in the company. When looking at the free cash flow generation over the past 12 months, The Navigator Company generated a cash flow of approximately EUR 275 million, the highest figure recorded since 2013. Slide 20. Turning to net debt, The Navigator Company's net debt fell by approximately EUR 56 million versus EUR 600 million in December 2020, standing at the end of March at EUR 624 million, with a consistent reduction path since Q1 2020 when net debt reached EUr 800 million. The net debt-to-EBITDA ratio remains at the conservative level of 2.33 x, excluding the impact of IFRS 16 on its interest in net debt.
On slide 21, we can see the debt maturity level of The Navigator Company. Gross debt held relatively steady in relation to year-end 2020. During Q1, The Navigator Company repaid a one-year loan taken in the context of the early days of the pandemic, EUR 40 million, and used a facility already contracted and negotiated totaling EUR 42.5 million. At the end of the quarter in April, Navigator undertook a significant restructure of its debt, repaying loans totaling EUR 240 million, maturity of two million long-term loans of EUR 170 million, yearly repayment of a bond issue of EUR 45 million, and repayment of short-term facilities of EUR 25 million.
At the same time, the second series of loans contracted in 2020 with a value of EUR 85 million with a maturity in 2023 was issued, and a further bond issue was made with a value of EUR 20 million, also contracted in 2020, maturing in 2026. This operation enabled the group to fix maturity of its debt to 3.5 years, and also to reduce the cost of medium and long-term debt. Now, I will return the floor to Ant ó nio.
Let's please turn to slide 23 with an overview of the quarter and the main developments occurring during the quarter. As mentioned before, Q1 was impacted by new surges in COVID-19 infections and the subsequent lockdowns in some of Navigator's key markets, with paper demand evolving at an identical rhythm as the previous quarter and pulp prices showing a great recovery, the steepest recorded in history. The maintenance stoppages anticipated during Q1 impacted pulp, paper, and energy output. The tissue business performed very positively in spite of away-from-home slowdown relative to the current situation. Navigator was able to continue to work on the cost side and registered favorable variable and fixed cost evolutions. This positive performance in costs allowed to partially offsetting the lower volume levels and reduced paper prices, with EBITDA reaching EUR 71 million and EBITDA sales margin registered about 21%.
Careful working capital management allowed to achieve a significant free cash flow during the period. Our balance sheet remains strong, with net debt reducing to EUR 624 million and net debt to EBITDA stood at 2.33 x. I will take the opportunity to quickly comment on the anti-dumping process. As we reported in January, the final rate for period of review number three, March 2018 to February 2019, was confirmed and fixed at 6.75%. U.S. authorities should, therefore, initiate the reimbursement process in the next months relative to the amount deposited in excess.
It is important to note that on every five-year anniversary of the anti-dumping duty order, U.S. authorities must begin a procedure called Sunset Review to reassess whether the anti-dumping order could be discontinued. U.S. authorities have now decided that a complete revision will be taking place on the anti-dumping process on uncoated free paper imports to USA, object of judicial order, including imports from Portugal. Navigator expects this to be a lengthy process, and this decision may indicate that the first hurdle has been successfully overcome. Finally, a few words on the outlook for the rest of the year. I think it's fair to say that as the economy recovers and the vaccination plan is implemented, conditions in the pulp, paper, and tissue sector can be expected to remain positive overall.
Continued high pulp prices in all regions are sustaining the gradual implementation of price rises for paper. As we have seen today, Navigator's order book and those in the industry stood at historically high levels, 57 and 32 days respectively at the end of April. On the supply side, some of the constraints experienced in the Q1 remain in place. In particular, the continued high levels of maritime freight, along with the delays in logistics chain, limiting access to Europe and Navigator's key markets by competitors from other geographical regions. The shutdown of capacity in order of about 1.8 million tons here in the U.S. between 2018 and 2021, as mentioned before, 26% of all U.S. capacity and another announced closures in Europe, which will take around 8% of European capacity, are creating positive pressure on the balance between paper supply and demand.
In the pulp market, after sharp rises in prices over recent months, the prospects now point to moderate evolution with a degree of stability in China and prices rising in Europe, narrowing the price differential between the two regions as we have witnessed in the last two months. In tissue, rising prices for pulp and other factors of production have put manufacturers' margins under pressure. In February, Navigator announced to the market that price rises between 6% and 8% will be implemented for tissue products as from April, and a number of other producers have also announced price increases for the Q2. These increases are currently underway. Navigator will continue to take action on the variables it is able to control, particularly with the management of its fixed and variable costs.
The company estimates it will maintain approximately 80% of the savings achieved in running costs between 2019 and 2020, namely in functioning costs, as well as when implementing its investment plan and its sustainability projects. Thank you very much.
Thank you, Ant ó nio. This ends our time for the presentation. We are now open to the Q&A session. Ladies and gentlemen, if you'd like to ask a question, please press star followed by one on your telephone keypad. We have a question in from António Seladas from A|S Independent Research. Ant ó nio, your line is now open. Please go ahead.
Hi, good morning. Thank you for the presentation. Thank you for taking my question. I have three questions. The first one is related with your net debt to EBITDA level. You mentioned 2.3 is a conservative level. If you can provide us what is the level that you consider normal. The second question is related with the slowdown or coming down of in-paper demand and your exposure to paper. I know that you don't like to answer this question. Nevertheless, if you can share with us, how do you believe the market will evolve in the coming years, namely more tissue, more packaging, less paper or print and writing, how Navigator will be on this environment. The last question is related to Mozambique, if you can provide us an update on Mozambique project. Thank you.
Okay. Thank you very much for your question. We will distribute the questions. I will try to answer your question number two, and I will start with that one. I'll ask Fernando to comment on the net debt to EBITDA levels, and I'll ask João to comment about Mozambique. We don't mind answering your question. That's all the questions we shall have, but we cannot provide guidance. We can tell you what is possible to tell at this stage. We are confident that the end consumer market will probably be more resilient than the majority of people believe, and we are confident of our footprint on the end consumer market, which is based in very high qualities, very strong brands, and a very wide geographical distribution across different continents, different regions of the world, different markets.
Some will be probably decreasing further than others, some in which we are present are still growing, namely Middle East and Africa. Definitely, the end consumer market will hardly be a mystery of growth for this company. The two areas that we have just mentioned, tissue and progressing in packaging, as we have mentioned before, we are producing packaging for almost 20 years. Although we started with a lot of visibility, we are keeping developing this area of business will likely be together with pulp, the areas of development for the company in the coming years. Having said that, and going back to end consumer, let's not forget that we are very well positioned in the cost curve, and we have been working very hard in the last few years to keep this cost position.
We're working on variable and fixed costs, and we do believe that in end consumer, although we have probably more positive views than the majority of the people when we look at the market, even if the market decreases, we keep having a very competitive position in end consumer, which today, as we have seen, represents about 70% of our business. It represented already a few years ago, 80%. It's natural that not by decreasing alone, but by increasing other areas of business, the representativeness of end consumer will slightly go down in the coming years. I will ask now Fernando to comment the first question of net debt to EBITDA and what we consider a normal level, if we can define what is a normal level. Fernando?
From our side, investment-grade companies should have a net debt EBITDA lower 3x. We are lower than 2.5x. That's why we call it a conservative level.
Okay. Thank you.
Okay. About the Mozambique project, as we expected, and we have planned, we are going on with the operations of harvesting the wood, transportation of that wood to the Beira harbor. The first of three shipments predicted for this year is about to start. We believe that in the middle of this month, we will start the loading, and the other two shipments will be following and be concluded this year. Everything is going as predicted, with no surprises at all whatsoever until now, of course, but everything is going ahead like we had planned. In terms of the Zambezia province, we are following the developments in what relates to the harbor construction. As far as we know, everything is going okay according to the scenario and the prediction that the concessionaire so far has been sharing with us and with the government.
We are following what is related with those developments, and everything is going normally so far.
We have a question in from Bruno Bessa of CaixaBank . Bruno, your line is open.
Yes, good morning. Thank you very much for taking my question. I have four, if it is fine. The first and second are related with prices, focusing on the first one. If you could provide more color on the implementation of price hikes for February and May, how we stand on this front at the end of today? Linked also to prices, the second question would be related, or would be the following: Do you plan any further hike over the coming months? We saw a German peer today announcing a price hike for July. Are you planning any kind of hikes over the coming months? This will be the number one and number two question. The number three question, how does the current backlog of the company compare with the same period in 2019?
The last question, related with the collection of the compensation in the U.S., if you could share with us the amount still pending related with this compensation, it would be appreciated very much.
Thank you, Bruno, for your questions. Can you repeat the last one, please?
Yes. The last one is related with the compensation that you are receiving in the U.S. related with the tariffs, that's what it calls. If you could share with us the amount that is still pending for collection related with this compensation.
Talking about the anti-dumping and the PR3 situation?
Yes, that's correct.
Okay.
How much is pending to be collected there?
Okay, thank you.
Okay. Thank you, Bruno. I will try to answer the first two questions, and Fernando will comment about the compensation of anti-dumping. I must say that the line was not very clear. I hope I'm going to answer the right questions you intended to raise. Regarding price increases, just to recap, in Europe, we have led an price increase announcement in February that was implemented in March and April. It was implemented more or less what we have been announcing. We have announced another price increase for May, which will be implemented from the 1st of July onwards. On top of that, we have a certain type of businesses that have fixed prices by semester. We expect those businesses also to increase regardless of the announcement, to increase anyhow from July onwards. In the rest of the world, USA, we have announced two price increases.
The first one was also implemented in March, April, and the second one will also be implemented somewhere around July. In overseas markets, we have announced a price increase in December that was implemented in January, another one in January, another one in February, another one in April. Now we are completely focusing ourselves in making sure that these announcements are going to be fully implemented. We do believe there are probably still some room to have further price increases, but this will depend very much on demand evolution on the H2 of the year, as well as the evolution of the pulp prices. Regarding your second question, which I think was related with our 57 days backlog, it compares very favorably not only with 2020 but also with 2019.
Actually, I think it's the third best in our last 12-13 years history for this time of the year. I'll ask now Fernando to comment on the anti-dumping PR3 reimbursement compensation.
Okay. We have still in the balance sheet amount to be reimbursed around EUR 5 million. This means more or less EUR 4 million to be recovered.
That's very clear. Thank you very much.
We have a question in from Luis de Toledo from Oddo BHF. Your line is open.
Good morning. I would like to know if you could provide further detail on the current strong backlog. You already mentioned that it's record levels. I would like to know if there's a particular point of strength that could be related to the reactivation of the economy in particular sectors, if it's all at the distributor level, or if there's something at the regional level that you would like to stress. Finally, if these high levels could be related with logistic issues that the overseas markets may be facing. Thanks.
Very well. Thank you for your question. Well, indeed, as we tried to mention during the presentation, the logistic constraints that we have been witnessing all over this year, and we are expecting to continue at least through the summer, are also partially responsible for the strong backlog the European industry is witnessing. There are regions where European producers compete with other geographies, namely Middle East, North Africa, that have been underserved by these other geographies, it's normal that European producers are getting a stronger order book because of that. On top of this, the fact that there is a very large mill that was announced to be shut down from Q3 onwards also puts some pressure on the backlogs of European producers.
Last but not least, the fact that this pandemic situation, vaccination seems to be under control and most likely over summer, the majority of European markets will get herd immunity, is helping people to return back to the offices, which obviously improves office paper consumption. Schools to reopen fully, which obviously also helps the office paper consumption. Probably most important than that is the fact that the economy is starting to improve, and everybody is looking to a very strong H2 of the year. The recovery of the economy implies a recovery of advertising and communication strategies. Hence, all the graphical industry will probably be rather busy on the H2 of the year. All of that will help to push the demand for uncoated free papers.
Thank you very much.
As a reminder, ladies and gentlemen, if you'd like to ask a question, please press star followed by one on your telephone keypad.
We have several questions on the webcast platform. If we don't have any more audio questions, I would like to start with those. The first question comes from Ignacio Arce from Bestinver. I read the question. Considering the expected release of pent-up demand in Q2 2021, the current record low levels of inventories for producers, the record high order books for producers, the large capacity shutdowns, and increase in hardwood prices, which should reduce further converting margins, it seems that uncoated free prices are set to rally strongly from June onwards. Do you agree with this view? If not completely, can you tell us why?
Well, probably rally strong is a too strong and optimistic view of the market. Yes, as we commented, because of all the price increase announcements that have been done so far and implemented so far, the ones that have been announced and to be implemented from July onwards, and we agree, we expect an overall boom in the economy across the world. I think further price increases might be expected. A rally, I don't know exactly what percentage determines what is a rally, a rally is probably too strong word if we compare to the rally that we have witnessed on the pulp side. Yes, indeed, we are positive about the evolution of the price of uncoated free now in Q2 already, in Q3, and in Q4.
Okay. Second question on the platform comes from Sajid Azatrin from Trillium Capital. Could you please comment on the discount effect in realized paper prices versus the index? We have seen an increase in discount on pulp side in the industry. How is it evolving in the paper industry? What are the main drivers of the change? Thank you.
As we have mentioned in previous calls, the nature of discounts in paper are very, very different from the nature of discounts in pulp. First of all, we need to split regions, Europe, U.S.A., and the rest of the world, if I may use this expression. In Europe and U.S.A., we are not witnessing any significant increase in discounts on paper through 2021. We don't expect them to increase with this positive stance on prices and the evolution that we are just commenting. On discounts outside Europe. Most likely they have actually been decreasing because of the scarcity of paper that was commented before, mainly because of logistics and difficulties to supply. We also will expect them to increase during 2021. Actually, it's very typical when the market prices go up, the discounts on paper go down.
Again, they are of very different nature, discounts of paper from discounts of pulp.
Third question comes from Paul Vacheron from Jefferies. The improvement to 57 days in the uncoated free order book is very encouraging. Do you think there is an element of cut size restocking from paper distributors as the return to offices starts across Europe? Asked another way, how are you monitoring to help customers and Navigators to best manage inventory levels through the supply chain? The second part of the question is on the European industry capacity closure. 25% of the uncoated free industry is now integrated and is under a lot of pressure given the higher pulp prices. Does this alone support further uncoated free price increases or are further capacity closures needed to drive prices higher like in the U.S.?
I think the second part of the question we have somehow already answered in previous questions. I would just remember that if we look probably for the last 10 years, the majority of the large shutdowns of capacity of uncoated free in Europe were actually not coming from non-integrated producers, but from integrated producers that have other areas of the business, and they could repurpose their paper machines to other types of products. Regarding the first part of the question, yes, besides what I've commented regarding demand in Europe, that led to the 57 days, and demand outside Europe, we see that most likely there is a restocking effect, not only in cut size, also in graphical papers, but with the information that we have available, and we monitor this monthly, we don't believe that this restocking is yet of any sort of concern.
Merchant stocks are becoming a bit more stocked, but they have not by no means being out of control. There is further room to develop the value chain, and we are helping our customers, like we mentioned last year during the pandemic, we are helping our customers as well to manage better their stocks and to increase visibility for the mills of their stock levels in order to control more efficiently stocks over the supply chain.
Okay, next question comes from Ignacio Arce from Bestinver, and I think it was partially answered, but I will say it again. Considering that the pandemic impact is mostly over and that the Navigator has somehow strong visibility now, is the company considering to resume the tissue expansion plans or perhaps to start other investment plans with regards to business diversification towards the production of other sort of products, if and when uncoated free recovers?
Yes, I think the question has been answered already, indeed, tissue has proven to be a very interesting platform for Navigator to grow and develop their business. This was very clear in 2020, and this is very clear also in the beginning of 2021. It's more than normal that we'll keep on studying expansion on this area of the business, if the opportunities are presented in the right moment and with the right scale. Regarding other areas of the business, as well, we have also commented that we have been producing packaging papers for quite some time, we are developing new grades of packaging.
We are bringing some innovation for packaging based on gKraft, so it's probably also normal that in the coming quarters, we will be able to share a bit more information, shed a bit more light into the developments of other papers regarding our parallel to uncoated free.
Next question from Ignacio as well. 2021 could be a very strong year for Navigator in terms of free cash flow generation. Will you submit the proposal to the AGM to distribute a higher dividend than that EUR 100 million already distributed a few days ago?
Well, the dividend is already known and it was already paid.
Final question, also from Ignacio. Several of your peers in Iberia have decided to monetize their renewable energy assets through an IPO or a private sale. Are you considering any of these options in order to crystallize the value of your energy business? Can you remind us what is your energy installed capacity, and what was the EBITDA generated by this segment in 2020? Thank you.
I will ask Nuno to answer this question.
Okay, first on our assets. We have currently 200 MW of installed capacity in renewable cogeneration plants, biomass-driven cogeneration plants. Additional 20 MW of fully dedicated electricity production out of biomass. In addition, we also have around 75 MW of cogeneration out of natural gas. As João mentioned earlier, we also have 10 MW of solar photovoltaic plants in our sites. Regarding your question, our competitors are considering IPOs or crystallizing their assets.
They have their strategy driven outside Portugal. Either in Spain or in Poland or in the U.K., this is where they plan to invest and continue growing. The Portuguese market, we do not consider it sufficiently attractive to go for a growth strategy in Portugal in energy. I think if you would ask our competitors, they would probably agree with us. Right now we consider to have sufficient attractive growth opportunities in our core businesses, mostly driven in, that are made, done, and based in Portugal. We are not considering any IPO or any stuff like that.
Okay. We have a couple more questions on the webcast platform. This one from Romy Ray from GBC-Garesco. Considering you are in a good financial shape, where would it be the focus on the company for next years? Apart from ESG, the idea is to be more focused in itself on gaining more and more productivity, or are you considering external opportunities?
The question has been already answered, but I will try to be more precise. The first and number one priority, apart from ESG, as was commented, is to strengthen our N+3 business by working in our pricing, by working in our cost base, and by working in our product mix. This will allow us to gain time to redefine the future for the company in different areas. Those areas, I would say, would be normal, is the development of tissue, as it was mentioned, is the development of pulp. We do believe we still have space to have some slight improvements on the pulp side, and as well is to find a roadmap on packaging that we have already started.
Last but not least, it was commented as well, is to develop a wood business base in Mozambique in view of having Mozambique in the world wood soon and preparing also a long-term future for our Mozambique investments. Those are the areas in which the company will focus in the coming future.
We have one final question from the group, Peter Ken, from Jonas Vizas. First, what will you do with your free cash flow not paid out? Maybe some ideas on growth CapEx or M&A. Second, order book is strong. Can you give an idea of which percentage of order book was booked at prices before announced prices versus after?
Regarding the first question, I don't think we will be in a position to give at this stage any more details than the ones that I already gave them. Regarding the second question, the prices in Europe, and Europe represents 60% or above of our N+3 business, prices in Europe are valid from the moment of dispatch. No matter when the orders were booked, the price that counts is the price on the date of dispatch. Prices in overseas markets, we are a mixed bag. We have markets and products where prices are fixed the way they are in Europe, so what counts is the moment of dispatch. There are prices of businesses that are counted in the moment where the price was registered.
Having said that, we have been discussing with lots of our customers outside Europe, and even those customers where prices were fixed, majority of them have accepted to change prices to the new prices that we have increased. I would say the majority of the business that we have, prices are valid from the moment of dispatch, regardless if the order was booked previously or not.
Okay. Thank you, Antonio. This ends the questions written on the webcast platform. I believe that there are no more questions on the phone. Can you confirm that, please?
We have no further questions on the phone lines.
Okay, thank you. This ends our presentation for today.