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EANS-News Lenzing AG / Lenzing Group achieves fourth best full-year results in its history

Nachrichtenagentur: news aktuell
14.03.2019, 09:35  |  292   |   |   
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Financial Figures/Balance Sheet/Company Information

Highlights -

* Challenging market environment due to low prices for standard viscose, less
favorable exchange rates and higher raw material and energy prices
* Very positive development of specialty fiber business with revenue share
exceeding 45 percent
* Dividend proposal of EUR 3.00/share plus a special dividend of EUR 2.00/share
* Results for 2019 expected at about the level of 2018 despite a significantly
more demanding market environment


Lenzing - The Lenzing Group's business developed well in the 2018 financial
year. A significantly more challenging market environment led to a decline in
revenue as well as earnings compared with the record results of the previous
year. This was primarily caused by lower selling prices for standard viscose,
exchange rate effects as well as higher raw material and energy costs.

Group revenue declined by 3.7 percent compared with the previous year to EUR
2.18 bn. The predicted challenging market environment for standard viscose, plus
less favorable exchange rates and a slight decline in sales volume were the key
contributing factors. EBITDA (earnings before interest, tax, depreciation and
amortization) was down by 24 percent to EUR 382 million due to price increases
for key raw materials and higher energy and personnel costs. The EBITDA margin
dropped from 22.2 percent in the 2017 financial year to 17.6 percent in the
reporting year. EBIT (earnings before interest and tax) fell by 36 percent to
EUR 237.6 mn, leading to a lower EBIT margin of 10.9 percent (2017: 16.4
percent). Net profit for the year after one-off effects dropped by 47.4 percent
from EUR 281.7 mn in the previous year to EUR 148.2 mn. Earnings per share
equaled EUR 5.61 (2017: EUR 10.47).

The Management Board and the Supervisory Board will propose a stable dividend of
EUR 3.00 per share plus a special dividend of EUR 2.00 per share at the upcoming
Annual General Meeting. In total, the paid dividend will amount to EUR 5.00 per
share, corresponding to a dividend payment to shareholders of roughly EUR 133
mn.

"Although 2018 proofed to be more challenging than the preceding years, it was,
nevertheless, the fourth best year in the company's history. We consistently
worked on the strategic imperatives of our sCore TEN corporate strategy in order
to raise our pulp integration, enhance customer intimacy, increase the share of
specialty fibers in revenue and to invest in new technologies and business
areas", says Stefan Doboczky, Chief Executive Officer of the Lenzing Group. "The
very positive development of our specialty business in an expected challenging
market environment for standard viscose confirms our strategic direction and our
ambitious plans. Thanks to its specialty strategy and its strong brands based on
innovation and sustainability, the Lenzing Group is significantly more resilient
today than only a few years ago. However, we are not immune to global
developments, and further efforts and investments in specialty fibers are
required to become even more resistant to market fluctuations", Doboczky adds.

Zwtl.: Solid balance sheet, further increase in CAPEX

Adjusted equity increased by 1.7 percent to EUR 1.55 bn. The adjusted equity
ratio decreased from 61.2 percent as at December 31, 2017 to 59 percent as at
December 31, 2018. ROCE (return on capital employed) declined to 10.3 percent in
2018 (2017: 18.6 percent). Despite higher capital expenditures, net financial
debt remained at a low level, totaling EUR 219.4 mn at the end of 2018 (December
31, 2017: EUR 66.8 mn).

Capital expenditures (CAPEX) of the Lenzing Group continued to increase to EUR
257.6 mn in 2018 (2017: EUR 238.8 mn.). Trading working capital rose by 7.2
percent to EUR 444.4 mn and cash flow from operating activities increased by 3.3
percent to EUR 280 mn. Expenditures for research and development (R&D),
calculated according to the Frascati method(1), amounted to EUR 42.8 mn in the
2018 financial year (2017: EUR 55.4 mn), putting Lenzing in the top ranks of the
industry both in absolute terms as well as in relation to revenue.

Zwtl.: Sustainability driven by innovation

The textile and nonwoven industries are faced with fundamental ecological
challenges, and as a leading producer of wood-based specialty fibers, the
Lenzing Group bears a special responsibility. In 2018, the company decided to
continue along its ambitious path and to invest roughly EUR 100 mn in
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