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:
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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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References
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2. media@lenzing.com
3. https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=redirect&url=5803f22d982f72dcc3d9f0027e178e6b&application_id=2205174&site_id=apa_ots_austria~~~18b544d0-9c71-4160-bd95-cc8b9aff9fbf&application_name=news
4. s.knus@lenzing.com
5. https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=redirect&url=5803f22d982f72dcc3d9f0027e178e6b&application_id=2205174&site_id=apa_ots_austria~~~18b544d0-9c71-4160-bd95-cc8b9aff9fbf&application_name=news
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