Lenzing Group Increased Revenue by 5.7% in the First Quarter of 2024
Lenzing Group, a leading supplier of regenerated cellulose for the textile and nonwovens industries, reported progress in its fibre sales units in the first quarter of 2024. The company’s revenue increased by 5.7% year-on-year to EUR 658.4 million in the first quarter of 2024. This growth is primarily attributable to higher fiber sales volumes.
Earnings before interest, tax, depreciation, and amortization (EBITDA) more than doubled to EUR 71.4 million in the reporting period (compared with EUR 29.7 million in the first quarter of 2023). The operating result (EBIT) was slightly positive at EUR 1.5 million (compared with minus EUR 41.4 million in the first quarter of 2023). Cash flow from operating activities stood at EUR 120.7 million in the first quarter of 2024 (compared with minus EUR 47.7 million in the first quarter of 2023).
“The business development of the Lenzing Group is heading in the right direction in the first quarter. However, we cannot speak of a sustainable market recovery as long as price pressure in the fiber business remains high,” notes Stephan Sielaff, Lenzing Group CEO. “Nevertheless, improved business performance and good demand for our specialty fibers show that we are also making good progress, especially with our initiatives to strengthen our sales activities. We are not awaiting a tailwind from the market but are continuing to implement our performance program with determination.”
The Managing Board expects annual cost savings of in excess of EUR 100 mn from 2025 onward
Since the third quarter of 2023, the Managing Board of Lenzing AG has been consistently implementing a comprehensive performance program with the overriding objective of significantly enhancing long-term resilience to crises, and of greater agility in the face of market changes. The program initiatives are primarily aimed at generating free cash flow and improving EBITDA through stronger revenue and margin growth, as well as sustainable cost excellence. In addition to the clearly positive effects on the revenue level, the Managing Board expects annual cost savings of in excess of EUR 100 mn from 2025 onward, of which more than 50 percent will have an increasing impact on earnings from the current financial year onward.
Nico Reiner, Lenzing Group CFO, adds: “We are very satisfied with the impact of the performance program to date, and expect the measures to make a greater contribution to further earnings improvements over the course of the coming quarters. The appointment of Walter Bickel as Chief Transformation Officer underscores the importance of this program and ensures that the existing Managing Board can devote all the necessary resources to its core tasks.”
Changes to the Managing Board
Lenzing also recently announced personnel changes on its Managing Board. The Supervisory Board of Lenzing AG has appointed Walter Bickel as member of the Managing Board and as Chief Transformation Officer of Lenzing AG until December 31, 2025, with effect as of April 15, 2024. Mr. Bickel, an experienced manager, will strengthen the Lenzing Managing Board and will be responsible for the further development and implementation of the performance program. Dr. Markus Fürst stepped down from the Supervisory Board of Lenzing AG as of the end of the Annual General Meeting, at his own request. Dr. Cornelius Baur was newly elected to the Supervisory Board until the Annual General Meeting that passes resolutions relating to the 2028 financial year. The mandate of Melody Harris-Jensbach mandate was also extended until the Annual General Meeting that passes resolutions relating to the 2028 financial year.
