Lanxess (LXS) Q1 2025 earnings summary

Executive summary

• Q1 2025 EBITDA pre increased 32% year-over-year to €133 million, reflecting improved utilization, cost savings, and a rebound in Consumer Protection amid a weak market environment.

• Net income improved to -€57 million from -€98 million in Q1 2024, supported by better operating performance and Envalior contribution.

• Sales remained flat at €1,601 million, with higher volumes offset by lower prices due to raw material cost pass-through.

• The divestiture of the Urethane Systems business to UBE was completed earlier than planned, with proceeds to be used for debt reduction and balance sheet strengthening.

• Persistently weak market conditions in agrochemicals and construction industries.

Financial highlights

• EBITDA pre exceptionals rose 31.7% to €133 million, with margin increasing to 8.3% from 6.3% year-over-year.

• Adjusted EPS improved to €0.23 from -€0.09 in Q1 2024.

• Capex increased 15% to €45 million.

• Free cash flow was -€111 million, impacted by seasonal working capital build-up.

• Net financial debt increased seasonally to €2,512 million.

Outlook and guidance

• Full-year 2025 EBITDA pre guidance reiterated at €600–650 million, including Q1 Urethane Systems contribution.

• Q2 expected to improve sequentially but remain below prior year due to absence of Urethanes contribution.

• No major FX headwinds expected due to comprehensive hedging at a rate of around EUR/USD 1.10.

• Slight growth anticipated in core and consumer businesses; construction improvement expected from 2026.

• Geopolitical tensions and US trade policy create significant market uncertainty.