EANS-Adhoc: Lenzing AG
Operating Results Of The Lenzing Group Above
Expectations, One-Off Effects Negatively Impact Year-End-Results 2014
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annual result/Company Information
02.03.2015
According to preliminary figures, consolidated sales of the Lenzing Group
declined slightly to EUR 1.86 bn in 2014, down from the prior-year level of EUR
1.91 bn in 2013. This drop can be attributed to the continuing downward pressure
on fiber prices as a consequence of the global surplus capacities of viscose
fiber producers.
Due to the changed medium-term viscose fiber price expectations, expansion plans
of Lenzing's subsidiaries PT. South Pacific Viscose (Indonesia) and Lenzing
Nanjing Fibers (China) will be adjusted to reflect the new market conditions. In
turn, this will lead to adjustments in the measurement of goodwill, property,
plant and equipment and other intangible assets of these Group companies
reported in the Group financial statements to the amount of about minus EUR 94
mn (preliminary). These non-cash measures will not have any negative effect on
the liquidity and net financial debt of the Lenzing Group. On a medium-term
basis, this will lead to an improvement in the Group's consolidated balance
sheet. As a result of these one-off effects, the Group profit for the year of
the Lenzing Group in the 2014 financial year is expected to be about minus EUR
14 mn (preliminary) and EBIT is expected to amount to about EUR 22 mn
(preliminary).
On an operational level, Lenzing succeeded in countering the prevailing trend in
the industry. According to preliminary figures, the Lenzing Group reported
consolidated earnings before interest, taxes, depreciation and amortization
(EBITDA) of about EUR 240 mn in 2014 in spite of the ongoing low selling price
environment. This increase totaling almost 25% compared to the similarly
challenging year 2013 (about EUR 194 mn from continued operations) was achieved
thanks to sustainable cost savings generated within the context of the excelLENZ
program, substantial improvements in the product mix and the successful coming
on stream of the new TENCEL® fiber production facility at the Lenzing site. In
particular, new TENCEL® applications for denim fabrics, shirts, home textiles
and new nonwoven products as well as generally new blends with cotton were
successfully launched on the market.
Furthermore, the Supervisory Board of Lenzing AG approved the reorganization of
its engineering and maintenance operations, workshops and Lenzing Technik, which
was first announced in November 2014. These measures will lead to additional
significant cost savings and productivity increases of about 15% in the
company's technical departments. These cost reductions will be based on setting
up a centralized maintenance unit, adapting engineering capacities to the lower
investment activity of the Lenzing Group in the future and strategically
repositioning Lenzing Technik. Moreover, the Supervisory Board authorized the
Management Board to explore potentially new ownership structures for all
sub-segments which do not belong to the core business of Lenzing Technik as the
optimal basis for these areas.
The Management Board will present the consolidated financial statements of the
Lenzing Group for the 2014 financial year at the annual results press conference
on March 24, 2015, as scheduled.
Further inquiry note:
Lenzing AG
Mag. Angelika Guldt
Tel.: +43 (0) 7672-701-2713
Fax: +43 (0) 07672-918-2713
mailto:a.guldt@lenzing.com
end of announcement euro adhoc
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issuer: Lenzing AG
A-A-4860 Lenzing
phone: +43 7672-701-0
FAX: +43 7672-96301
mail: a.guldt@lenzing.com
WWW: http://www.lenzing.com
sector: Chemicals
ISIN: AT0000644505
indexes: WBI, ATX, Prime Market
stockmarkets: free trade: Berlin, official market: Wien
language: English
Original content of: Lenzing AG, transmitted by news aktuell