EQS-News: Lenzing AG refines strategy and strengthens competitiveness for a challenging environment

EQS-News: Lenzing AG / Key word(s): Strategic Company Decision
   Lenzing AG refines strategy and strengthens competitiveness for a
   challenging environment

   29.09.2025 / 12:27 CET/CEST
   The issuer is solely responsible for the content of this announcement.

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   Lenzing AG refines strategy and strengthens competitiveness for a
   challenging environment

    

     • Focus on high-margin market segments, high-performance fibers
     • Cost savings including headcount reduction in Austria
     • Intended strategic investments over EUR 100 mn to secure long-term
       competitiveness of Austrian sites
     • Strategic review of the Indonesian production site initiated
       triggering a non-cash impairment loss
     • EBITDA guidance 2025 confirmed

    

   Lenzing, September 29, 2025 – Lenzing AG, a leading provider of
   regenerated cellulosic fibers, refined its strategy to strengthen its
   global positioning and competitiveness. With this step, the company
   responds to the ongoing challenges in the global textile and nonwovens
   markets as well as geopolitical changes. Cornerstones of the refined
   strategy include focusing on high-performance fibers, enhancing
   operational efficiency and asset footprint optimization, which should
   further unlock the company’s full value creation potential.

    

   “For us, 2025 is the year of continued execution. We have demonstrated
   that we can increase our profitability even in a challenging environment.
   It is important to further strengthen the agility, resilience and cost
   position of Lenzing with the aim of long-term value creation in order to
   reinforce the company’s position as global market leader in sustainable
   cellulosic fibers”, says Chairman of the Managing Board and CEO Rohit
   Aggarwal. “We are building on our strength as an innovation leader while
   optimizing our structures and processes to realise cost savings and
   further strengthen our competitiveness.”

    

   In the first half of 2025, the company achieved continued increase in
   earnings and profitability with strong cash flow generation. Despite this
   positive development, Lenzing anticipates that the global environment will
   remain volatile and uncertain. Trade conflicts, subdued consumer
   sentiment, rising costs, and increasing competition from Asia continue to
   shape a challenging market environment. The company’s refined strategy
   prepares it to succeed in challenging market conditions: leaner, more
   agile, more resilient – with any market recovery as an upside.
    

   Strategic priority: Focus on premium products to grow in high-value end
   markets

   Premium branded fibers with higher margins – TENCEL™, VEOCEL™, LENZING™
   ECOVERO™ – will take center stage, with a gradual withdrawal from
   lower-margin commodity segments. In line with this premiumization
   strategy, the company started a strategic review including a potential
   sale of its Indonesian production site. 

    

   Growth will not only be targeted in established applications such as
   denim, home textiles, and menswear, but also through expansion in hygiene,
   packaging, filtration, medical, and industrial applications. In addition,
   production capacities will be selectively shifted from textile to nonwoven
   applications in order to capture the growing demand for renewable nonwoven
   fibers. Application driven innovation through strategic partnerships with
   customers will be pursued with greater intensity by strengthening
   Lenzing’s application innovation centers.

   The refined focus of resources will expand Lenzing's technological
   leadership and strengthen the regional sales organization.
    

   Additional measures to improve cost competitiveness

   The weak market recovery (e.g. due to tariff uncertainties), low generic
   fiber prices in China, and rising costs in personnel, energy, and raw
   materials require additional measures to ensure long-term competitiveness.
   To further strengthen operational efficiency, Lenzing plans to reduce
   costs with a series of efficiency measures. This includes a reduction in
   headcount in the Lenzing-based headquarter. Jobs, particularly in
   overhead, will be reduced by approximately 300 employees, thereof 250
   until the end of 2025 with an objective to make administrative areas of
   Lenzing leaner and more efficient. This is expected to result in annual
   savings of over EUR 25 mn from 2026 onwards. At the same time, the company
   will strengthen its international presence in Asia and North America,
   moving closer to its customers in key textile and nonwoven markets. This
   internationalization move will result in another headcount reduction at
   the Lenzing site of approximately 300 employees by end of 2027, with both
   measures leading to total annual savings of more than EUR 45 mn, latest
   fully effective before end of 2027. Lenzing is aware of its responsibility
   towards its employees, and all necessary measures will be implemented in
   accordance with a new social plan already agreed with the works council
   representatives.

    

   Additional efficiency measures include a systematic energy optimization in
   all plants to reduce energy consumption by more than five per cent,
   bringing both cost and sustainability benefits. Another lever to drive
   labor and asset productivity is a continued relentless focus on an
   operational excellence program.

    

   Lenzing COO Georg Kasperkovitz comments: ”The refinement of the strategy
   has – despite social plan and additional support – tough but unavoidable
   implications for around 600 out of more than 3,500 Austrian employees.
   However, cutting labor cost is just one of several elements to increase
   profitability and unlock Lenzing’s value. Lenzing will remain a major
   industrial company in Austria, also strengthened by intended local
   investments exceeding EUR 100 mn.”
    

   More than EUR 100 mn in intended strategic investments at Austrian sites
   Lenzing and Heiligenkreuz, further investments in preparation

   To strengthen competitiveness and lasting site profitability in Austria,
   an investment package has also been put together for the Lenzing and
   Heiligenkreuz sites. More than EUR 100 mn are intended to be invested at
   both sites until end of 2027. Heiligenkreuz will strengthen its global
   leadership position as the most environmentally friendly production
   facility of specialty fibers and the hub to drive innovation through
   targeted investments in new technologies. At the Lenzing site, further
   investments with strategic partners are in preparation to support
   Lenzing’s premiumization strategy.

    

   The Management Board decided to start a review of strategic options
   including a potential sale for the Indonesian production site, which
   supports Lenzing’s strategic focus on branded high-performance fibers with
   higher margins. Accordingly, Lenzing AG expects to recognize impairment
   losses of the non-current assets, especially property, plant and equipment
   of up to EUR 100 mn in 2025. This non-cash charge impairment has a
   negative impact on consolidated EBIT and consolidated net income but no
   impact on Lenzing’s EBITDA.

   International markets with growth prospects

   The global demand for regenerated cellulosic fibers is forecasted to grow
   at 5 to 6 percent per year over the next five years. A growing global
   population, increasing purchasing power, global constraints of cotton
   supply and increasing willingness to pay for sustainability drive this
   volume growth. With growth rates above the general market, Lyocell and
   Modal are relatively small but attractive segments. Lenzing is a leader in
   these high-growth market segments and will focus resources to capture this
   profitable growth potential, thereby reducing exposure to the mature
   Viscose standard fiber market and shifting resources to the growing
   TENCEL™ and VEOCEL™ branded applications.

    

   With the refined strategy Lenzing aims to achieve a balanced distribution
   both of revenues across the world and between textile and nonwoven
   business, thereby also strengthening its pulp business.
    

   Outlook

   With the measures initiated, the company is further strengthening its
   position as a premium supplier of regenerated cellulosic fibers. The goal
   is to secure value creating growth despite a challenging market
   environment and to enhance resilience – with any market recovery as an
   upside.

    

   The Management Board of Lenzing confirms the “above previous year” EBITDA
   guidance for the financial year 2025. Based on the refined strategy and
   defined measures, Lenzing’s management targets an EBITDA of around EUR 550
   mn for 2027, subject to unchanged market conditions and geopolitical
   stability.

    

   Photo download:

   [1]https://mediadb.lenzing.com/pinaccess/showpin.do?pinCode=Fl2LsVzhrUfj
   PIN: Fl2LsVzhrUfj

    

   Your contact for                                          
   Public Relations:                               Investor Relations:
                                                             
   Milena Ioveva                                     Sébastien Knus
   VP       Corporate       Communications, Vice President Investor Relations
   Sustainability,                                           
   Investor Relations and Public Affairs                     
                                               Phone     +43 664 828 1576
   Phone   +43 7672 701 2743                E-mail     [4]s.knus@lenzing.com
   E-mail   [2]media@lenzing.com              Web        [5]www.lenzing.com
   Web      [3]www.lenzing.com
    
                                             

   About the Lenzing Group
    
   The Lenzing Group stands for  the responsible production of specialty  and
   premium fibers based  on regenerated cellulose.  As an innovation  leader,
   Lenzing is  a partner  of global  textile and  nonwoven manufacturers  and
   drives  many   new  technological   developments.  The   Lenzing   Group’s
   high-quality fibers  are the  raw material  for a  wide range  of  textile
   applications –  ranging  from  functional,  comfortable,  and  fashionable
   clothing through to durable  and sustainable home textiles.  TÜV-certified
   biodegradable and compostable Lenzing fibers are also ideal for  demanding
   use in everyday hygiene applications.
    
   The  Lenzing  Group’s  business  model  extends  far  beyond  that  of   a
   traditional fiber  producer. Together  with  its customers  and  partners,
   Lenzing develops innovative products along  the value chain, adding  value
   for consumers. The  Lenzing Group  strives for  efficient utilization  and
   processing of all raw materials and offers solutions for the transition of
   the textile industry from the current linear economic system to a circular
   economy. In order  to align  its commitment to  limiting man-made  climate
   change with  the  goals of  the  Paris  Agreement, Lenzing  has  a  clear,
   science-based  climate  action  plan  that  provides  for  a   significant
   reduction in greenhouse gas emissions (Scopes 1,  2, and 3) by 2030 and  a
   net-zero target by 2050.
    
   Key Facts & Figures Lenzing Group 2024
   Revenue: EUR 2.66 bn
   Nominal capacity (fibers): 1,110,000 tonnes
   Employees (full-time equivalents): 7,816
    
   TENCEL™, LENZING™ ECOVERO™, VEOCEL™, LENZING™ and REFIBRA™ are  trademarks
   of Lenzing AG.

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   29.09.2025 CET/CEST This Corporate News was distributed by EQS Group.
   www.eqs.com

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   Language:    English
   Company:     Lenzing AG
                4860 Lenzing
                Austria
   Phone:       +43 7672-701-0
   Fax:         +43 7672-96301
   E-mail:      office@lenzing.com
   Internet:    www.lenzing.com
   ISIN:        AT0000644505
   Indices:     ATX
   Listed:      Vienna Stock Exchange (Official Market)
   EQS News ID: 2205174


    
   End of News EQS News Service


   2205174  29.09.2025 CET/CEST

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