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Austria’s Lenzing reports 25.2% revenue growth in H1 2022

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Austria-based Lenzing Group’s income grew by 25.2 per cent year-on-year to succeed in €1.29 billion within the first half (H1) of 2022, primarily as a result of increased fibre costs. The earnings development primarily displays the price development in international vitality and uncooked materials markets, which affected the entire of producing business.

Vitality, uncooked supplies and logistics prices rose sharply as soon as once more within the reporting interval, after price stress had already risen steadily all through the 2021 monetary yr. Consequently, earnings earlier than curiosity, tax, depreciation and amortisation (EBITDA) decreased by 13.3 per cent year-on-year to €188.9 million.

Austria-based Lenzing Group’s income grew by 25.2 per cent year-on-year to succeed in €1.29 billion in H1 2022, primarily as a result of increased fibre costs. The earnings development primarily displays the price development in international vitality and uncooked materials markets, which affected the entire of producing business. Its EBITDA decreased by 13.3 per cent year-on-year to €188.9 million.

The energy of the specialty technique and of manufacturers primarily based on innovation and sustainable exercise in addition to the continued concentrate on measures to enhance structural earnings in all areas mitigated this adverse impact. The EBITDA margin lowered from 21.1 to 14.6 per cent in H1. Web revenue for the interval decreased by 24.8 per cent to €72.3 million, whereas earnings per share amounted to €2.36 (in comparison with €3.06 in H1 2021), the corporate mentioned in a media launch.

“Within the first half of 2022, we now have achieved an unlimited quantity collectively as a way to obtain our bold development and sustainability targets. Due to appreciable efforts, we may be glad with our enterprise efficiency given the intense developments in international vitality and uncooked materials markets,” commented Stephan Sielaff, Lenzing Group CEO. “The second half of the yr will proceed to be characterised by elevated ranges of uncertainty and excessive challenges on the vitality and uncooked supplies sides.”

Gross money move lowered by 14.9 per cent to €169.7 million in H1 2022, primarily reflecting the earnings development. Because of the increased degree of working capital, money move from working actions amounted to €15.2 million (in comparison with €199.8 million in H1 2021). Free money move amounted to minus €372.7 million (in comparison with minus €224.3 million in H1 2021), which particularly mirrored the funding actions associated to the tasks in Thailand and Brazil. Capital expenditure on intangible belongings, on property, plant and tools and on organic belongings (CAPEX) decreased by 8.7 per cent to €389 million.

In March 2022, the Lenzing Supervisory Board introduced the appointment of Stephan Sielaff as the brand new CEO of the Lenzing Group. As of April 1, 2022, Sielaff succeeded Twine Prinzhorn, who took over as interim CEO within the fourth quarter of 2021. This reduces the managing board from 5 to 4 members. CFO Thomas Obendrauf knowledgeable the Lenzing supervisory board that he wouldn’t be obtainable for an additional extension of his contract, which expired in June 2022. The Lenzing Supervisory Board is presently engaged on a substitute for him. Till a successor is appointed, Stephan Sielaff will carry out the CFO’s duties on an interim foundation, whereas Thomas Obendrauf will help the corporate in an advisory capability.

In the meantime, the managing board mandate of chief pulp officer Christian Skilich was prolonged early by an additional three years till Might 31, 2026. Personnel modifications additionally occurred on the Lenzing Supervisory Board. Twine Prinzhorn took over as chairman from Peter Edelmann, who stepped down from the supervisory board at his personal request with impact as of April 26, 2022, the discharge added.

Lenzing will proceed on its worthwhile development trajectory following the profitable implementation of the 2 key tasks in Thailand and Brazil. Lenzing has additionally adjusted its monetary targets and, assuming {that a} wholesome financial atmosphere prevails, will considerably enhance its EBITDA to over €1 billion by 2027, with an ROCE of over 12 per cent.

With the opening of the lyocell plant in Thailand in March and the investments in present manufacturing websites in China and in Indonesia, Lenzing will have already got elevated specialty fibres’ share of fibre income to nicely above the 75 per cent goal by the 2024 goal yr.

The implementation of the pulp challenge in Brazil secures the Group’s personal provide of dissolving wooden pulp and thereby additionally strengthens development in specialty fibres in keeping with the company technique. With the profitable start-up on schedule, Lenzing, which holds a 51 per cent curiosity within the LD Celulose three way partnership, reached an additional vital milestone. The plant ramp-up section is scheduled to be accomplished by the top of 2022.

In 2019, Lenzing turned the primary fibre producer to set a goal to cut back its carbon emissions by 50 per cent by 2030 and to be climate-neutral by 2050. This carbon discount goal has been confirmed by the Science Primarily based Targets Initiative, the discharge additional mentioned. To additional scale back carbon emissions in keeping with its strategic targets, Lenzing will rely to a fair larger extent sooner or later on electrical energy technology from renewable energies. It’s presently engaged on the development of a number of photovoltaic methods at its website in Higher Austria. The entire capability of the ground-mounted system and the three rooftop methods will quantity to roughly 7 MW peak after the anticipated commissioning within the second half of 2022.

The Indonesian website has been sourcing inexperienced electrical energy completely from renewable sources since July this yr and is presently being transformed to biomass. In Purwarkata, Lenzing invests in lowering CO2 emissions in addition to air and water emissions. As a part of this funding, Lenzing is changing its present capacities for normal viscose solely to capacities for specialty viscose underneath the Lenzing Ecovero and Veocel manufacturers.

The Tencel model has been supporting prospects and companions within the textile and attire business with sustainable fibre improvements since 1992. In 2022, Lenzing is celebrating the 30th anniversary of its premium textile model.

The foreign money atmosphere is anticipated to stay unstable within the areas related to Lenzing. In structural phrases, Lenzing continues to anticipate development in demand for environmentally accountable fibres for the textile and clothes business in addition to the hygiene and medical sectors. Because of this, Lenzing regards the additional improvement of its technique as having been validated and can proceed to drive development in specialty fibres and strengthen its personal provide of dissolving wooden pulp, together with boosting the sustainable vitality combine and the discount of carbon emissions.

The Lenzing Group continues to anticipate that EBITDA for the total 2022 yr can be considerably above the extent of 2021.

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