EANS-Adhoc

Lenzing AG / Lenzing to implement further cost optimization measures

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other
28.05.2014

Due to the very unsatisfactory development of prices on the global
market for viscose fibers, the Lenzing Group will be implementing
additional cost reduction measures. Today, the Management Board
informed employees at the facilities in Lenzing about the necessity
of further measures to secure the long-term competitiveness of the
Lenzing Group. In relation to this, the Management Board today
announced a wide-ranging review of the Group strategy, the results of
which should be available by the end of 2014.

As noted in the report on Q1 2014, extensive measures were already
successfully implemented within the framework of the cost
optimization program "excelLENZ 2.0". Thanks to this program, it was
possible to prevent layoffs in Lenzing, despite the staff reduction
measures already carried out. Nevertheless, in light of the current
level of fiber prices, the savings of more than EUR 60 - 80 mn for
2014 are still not enough to ensure the long-term profitability of
cellulose fibers production at the European facilities. The targeted
cost reductions of up to EUR 160 mn by 2016 must also be increased
due to the market development.

CEO Peter Untersperger: "In light of the structural changes in
competitive conditions, our goal is to lead the Lenzing Group back to
its previous competitiveness. Further cost optimization is an
inevitable part, but - within the framework of strategic
restructuring - we will also decide to which products we can
manufacture over the long run at which sites with the highest levels
of quality and at optimized costs. There can be no taboos. Everything
must be looked at."

Furthermore, a strategy group was established by the Management
Board. This group will look at the development of new specialty
fibers for Lenzing AG, the production and market positioning which
will help to secure the unique selling proposition and profitability,
also of the Austrian sites.

Both the works council and political decision-makers will be informed
about the difficult market situation and their support has been
requested in this process.

Further inquiry note:
Lenzing AG

Mag. Angelika Guldt

Tel.: [phone]

Fax: [phone]

mailto:[e-mail]

end of announcement euro adhoc
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issuer: Lenzing AG

A-A-4860 Lenzing
phone: [phone]
FAX: [phone]
mail: [e-mail]
WWW: http://www.lenzing.com
sector: Chemicals
ISIN: AT0000644505
indexes: WBI, ATX, Prime Market
stockmarkets: free trade: Berlin, official market: Wien
language: English