LANXESS reported a challenging fiscal year 2025, marked by weak market conditions and ongoing geopolitical uncertainty, with the company expecting a recovery only in the second half of 2026.
The specialty chemicals firm recorded a 10.9 percent decline in revenue, which stood at EUR 5.673 billion in 2025, compared to EUR 6.366 billion in the previous year. EBITDA pre-exceptionals also fell by 16.9 percent to EUR 510 million, while the EBITDA margin declined to 9.0 percent from 9.6 percent year-on-year.
The downturn was primarily driven by subdued demand across key customer industries, lower sales volumes, and continued pricing pressure, particularly from Asian markets. Reduced raw material costs also contributed to lower selling prices, while the absence of earnings from the Urethane Systems business, divested in April 2025, further impacted performance.
Commenting on the outlook, Matthias Zachert, CEO of LANXESS, said, “2025 was an extremely tough year for the entire chemical industry and for LANXESS as well. For 2026, we expect to see positive momentum in the second half of the year at the earliest, for example through the German government’s infrastructure stimulus program,” he said. “For us, therefore, the guiding principle for 2026 remains: We control the things we can control. That means continuing to cut costs, streamline processes, and create new market opportunities.”
For the full year 2026, the company has projected EBITDA pre-exceptionals in the range of EUR 450 million to EUR 550 million.
As part of its strategy to improve profitability, LANXESS has initiated additional cost-cutting measures targeting permanent annual savings of around EUR 100 million by 2028. This includes plans to reduce approximately 550 jobs, primarily in administrative functions, with a focus on implementing these changes through natural attrition and demographic adjustments.
These measures build on earlier initiatives, including production network optimisations announced in 2025, expected to generate an additional EUR 50 million in annual savings. Combined with the “FORWARD!” action plan launched in 2023, the company aims to achieve total structural cost savings of around EUR 150 million by the end of 2028.
In the short term, LANXESS is also implementing labour cost controls, including a temporary 35-hour workweek for certain employees and a freeze on base salary increases for management and non-union staff.
The company has also strengthened its balance sheet, reducing net financial debt by 15 percent to EUR 2.023 billion at the end of 2025, largely supported by proceeds from the sale of its Urethane Systems business.
Segment-wise, the Consumer Protection division showed resilience with stable EBITDA despite declining sales, supported by cost-saving measures. Meanwhile, the Specialty Additives and Advanced Intermediates segments faced continued pressure due to weak demand, lower capacity utilisation, and adverse currency movements.
Overall, while near-term challenges persist, LANXESS remains focused on cost discipline, operational efficiency, and strategic restructuring as it prepares for a gradual recovery in the latter half of 2026.
