Lenzing (LNZ) Q3 2024 earnings summary

Executive summary

• Revenue grew 5% year-over-year to nearly €2 billion for the first nine months of 2024, with Q3 revenue at €647 million, driven by higher fiber sales and improved volumes.

• EBITDA rose 20% year-over-year to €264 million for the nine months, with Q3 EBITDA at €99 million and margin up to 13.5% due to performance program benefits.

• Free cash flow was positive for the fifth consecutive quarter, reaching €192 million for the nine months, up from negative €138 million in the prior year.

• Net loss after tax was €111.1 million, impacted by a €77.7 million tax expense, including a €25.8 million tax transfer due to group structure changes.

• The performance program, launched in Q3 2023, targeted over €100 million in annualized cost savings, with more than 50% effective in 2024.

Financial highlights

• EBITDA margin improved to 15% in Q3 and 13.5% for the nine months.

• Net financial debt decreased by 13.1% year-over-year to €1,357 million.

• CapEx reduced by over 50% year-over-year to €95.5 million, focused on maintenance and license-to-operate projects.

• Adjusted equity ratio declined to 31.9% from 34.7% at year-end 2023.

• Liquidity cushion increased to over €1 billion, with liquid assets up 16.4% to €851.2 million.

Outlook and guidance

• Guidance for 2024 financial year confirmed: EBITDA is expected to be higher than the previous year.

• Market visibility remains low due to global economic and geopolitical uncertainties.

• Stable demand in bulk and continued demand growth for sustainable specialty fibers are expected.

• Ongoing margin improvements and cost excellence are anticipated.