Lenzing swings to H1 loss, but upbeat on signs of recovery

Austrian fibre production company Lenzing swung to a loss in the first half of the year but was upbeat as it saw signs of improvement throughout the period.

The maker of Tencel lyocell fibers reported a net loss of 65.8 million euros compared to a net profit of 72.3 million euros a year earlier, while its EBITDA narrowed to 136.5 million euros from 188.9 million euros.

That came as the company posted a 3.4 percent drop in revenue to 1.25 billion euros in “a persistently difficult market environment”.

While the H1 results were down on the prior year, the company was upbeat that its EBITDA and net results “significantly improved compared with the first quarter of 2023”.

It said its cost-cutting program and measures to strengthen sales activities have been implemented as planned, and that its liquidity position has been strengthened by successful capital increase and extension of credit terms.

The company said its performance year-to-date “largely reflected the subdued market trends in the first half of 2023”.

However, it added: “After the market environment deteriorated significantly in the second half of 2022, signs of recovery were evident during the first and second quarters of 2023 in terms of both raw material and energy costs as well as demand.

“Textile fibers recorded improving demand, and business with nonwoven fibers and with dissolving wood pulp proved to be very stable.”