Lenzing AG

EANS-Adhoc: Lenzing AG
Lenzing Group: Most Successful First Half-Year in the Company´s History


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6-month report

23.08.2011

-Outstanding second quarter 2011
-Positive outlook for 2011 confirmed 

The Lenzing Group can once again report record results, and looks back at the
most successful first half-year in the company´s history. Following a very good
first quarter 2011, sales and earnings could be significantly surpassed again in
the second quarter of 2011. Thus Lenzing has set its guidance for the entire
year 2011 at the upper end of the initial guidance announced in the first
quarter, thus forecasting an EBITDA of EUR 470 mill. to EUR 500 mill. and
consolidated sales between EUR 2.1 bill. and EUR 2.2 bill. 

In the first half of 2011, consolidated sales rose by 31.0%, from EUR 821.4
mill. to EUR 1,076.2 mill. The reasons underlying the revenue increase were
mainly considerably higher fiber prices compared to the prior-year level, as
well as the higher fiber shipment volumes and the consolidation effects from the
acquisition of the Biocel Paskov pulp plant. 

Earnings before interest, tax, depreciation and amortization (EBITDA) in the
first six months of 2011 rose by 65.1% to the new record level of EUR 247.8
mill. This resulted in an all-time high EBITDA margin of 23.0% (H1 2010: 18.3%).
Operating profit (EBIT) was almost doubled, rising by 84.5% to EUR 199.2 mill.
(compared to the already excellent EBIT of EUR 108.0 mill. achieved in the first
half of 2010). This corresponds to an EBIT margin of 18.5% (H1 2010: 13.1%). 

Outstanding second quarter 2011
The second quarter of 2011 featured consolidated sales of EUR 544.1 mill. and an
EBITDA of EUR 132.9 mill. (margin of 24.4%), an outstanding performance which
comprises the best quarterly results in the company´s history. The EBIT of EUR
108.5 mill. (margin of 19.9%) also represents a new all-time high for Lenzing.

"Our global growth strategy together with our intensified specialization in high
value fibers such as Lenzing Modal® and TENCEL®, for which we have a unique
position on the market, has really paid off", says Lenzing Chief Executive
Officer Peter Untersperger, commenting on the Group´s business development. In
any case, the long-term positive development in the form of excess demand for
cellulose fibers ("cellulose gap") will continue and will not be seriously
impeded by the latest decline in cotton prices to a realistic price level again,
CEO Untersperger adds. 

Positive development of all segments
In the core business segment of the Lenzing Group, Segment Fibers, Lenzing was
able to carry out several selling price increases in the first half-year, most
recently for its specialty fibers, against the backdrop of the full utilization
of its production capacities. These price hikes more than compensated for the
expected price consolidation for standard viscose fibers for the Asian textile
industry which took place in the second quarter. Thus Lenzing´s average fiber
prices for textile applications in the second quarter of 2011 were higher than
in the first quarter. Volume demand for textile fibers remained strong
throughout the entire half-year.  

Lenzing also recorded a stable price and volume development at a high level in
the Business Unit Nonwoven Fibers, whose average fiber prices in the second
quarter were also above those in the first quarter of 2011.  

The Segments Plastics Products and Engineering developed very positively, and
achieved significantly better results than in the prior-year period. 

Outlook Lenzing Group
The Lenzing Group confirms its last published outlook for the entire year 2011,
in which the company anticipates consolidated sales between EUR 2.1 bill. and
EUR 2.2 bill. The expected EBITDA will be in the range of EUR 470 mill. and EUR
500 mill., corresponding to the upper half of the initial outlook. A decisive
underlying factor is the very good business development of the Lenzing Group in
the second quarter of 2011, which exceeded expectations.    

On average business development for Q3 and Q4 2011 is expected to be similar to
the first quarter´s performance. The additional production volumes resulting
from the capacity expansion of Lenzing Nanjing (China) should have a positive
effect. An ongoing high price level along with good demand is anticipated for
the specialty fibers Lenzing Modal® and TENCEL® also in the second half-year. In
contrast, the continuation of the short-term price consolidation trend for
standard viscose fibers in Asia which is still taking place along with the
resulting "pipeline effect" should have a dampening effect.

Even against the backdrop of a very good cotton harvest 2011/2012, the
structural influencing factors underlying the "cellulose gap" - population
growth, increasing prosperity and sustainability - will continue to apply fully.



Important IFRS performance indicators on a Group-wide basis 
(in EUR million)                                      1-6/2011     1-6/2010
Consolidated sales                                     1,076.2        821.4
EBITDA                                                   247.8        150.1
Operating profit (EBIT)                                  199.2        108.0
Income before tax and minority interests (EBT)           187.7        101.6
Net income for the period                                145.3         77.1
EBITDA margin in %                                        23.0         18.3
EBIT margin in %                                          18.5         13.1
Gross cash flow                                          191.5        122.3
Investments (Intangible assets, property, 
plant and equipment)                                      82.1         66.2

                                                    30/06/2011   31/12/2010
Adjusted equity ratio* in %                               42.3         38.6
Staff                                                    6,323        6,143

*Equity incl. investment grants, less proportionate deferred taxes

Segment reporting
(in EUR million)                                      1-6/2011     1-6/2010
Segment Fibers      
Sales                                                    967.9        741.1
EBITDA                                                   235.8        143.2
Operating profit (EBIT)                                  189.9        103.0
Segment Plastics Products      
Sales                                                     92.2         69.8
EBITDA                                                     8.7          4.8
Operating profit (EBIT)                                    5.3          2.5
Segment Engineering      
Sales                                                     53.7        43.6(1) 
EBITDA                                                     4.9          3.2
Operating profit (EBIT)                                    4.2          2.5

(1)Adjusted for intra-segment sales


Further inquiry note:
Lenzing AG
Mag. Angelika Guldt
Tel.: +43 (0) 7672-701-2713
Fax: +43 (0) 7672-918-2713
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, Prime Market
stockmarkets: free trade: Berlin, official market: Wien 
language:   English
 

 

 



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