Lenzing Improves Profitability in First Nine Months of 2026

The Lenzing Group maintained stable adjusted earnings and improved its profitability in the first nine months of 2026, despite ongoing market challenges. Revenue reached EUR 1.93 billion, compared with EUR 1.97 billion in the same period last year. Meanwhile, adjusted EBITDA remained almost unchanged at EUR 353 million.

The adjusted EBITDA margin improved to 18.3 per cent from 17.9 per cent in the previous year. The company also reported stronger margin performance in the third quarter, with the adjusted EBITDA margin rising by 4 percentage points year on year, from 13.3 per cent to 17.3 per cent.

Lenzing attributed this progress to its strategic focus on profitability and operational improvements. Its strategy, ‘Grow Nonwovens. Reset Textiles.’, adopted in July 2026, aims to strengthen its fibre portfolio and improve earnings.

“The third quarter of 2026 marks an important milestone in the repositioning of the Lenzing Group. Our focus is now on the consistent execution of our new strategy. The stable earnings development and improved margin demonstrate that our measures are delivering results. Under the strategic priorities “Grow Nonwovens. Reset Textiles.”, we are driving our transformation forward and will take further significant steps by year-end to optimize our product portfolio and production network,” says Georg Kasperkovitz, CEO of the Lenzing Group.

Financial Performance in the First Nine Months

Lenzing’s revenue declined by 2.3 per cent to EUR 1,926.3 million during the reporting period, compared with EUR 1,972 million a year earlier. Lower sales volumes, following the planned reduction in standard fibre production, and lower pulp prices contributed to this decline.

Adjusted EBITDA stood at EUR 353 million, almost matching the previous year’s EUR 352.7 million. As a result, the adjusted EBITDA margin increased to 18.3 per cent.

However, reported EBITDA fell by 7 per cent to EUR 316.4 million from EUR 340.4 million. This figure included EUR 36.6 million in restructuring-related costs, compared with EUR 12.3 million in the previous year. The EBITDA margin also declined to 16.4 per cent from 17.3 per cent.

The operating result (EBIT) recorded a loss of EUR 55.1 million, compared with a profit of EUR 20.6 million in the previous year. Non-cash impairment charges of EUR 136.1 million on long-term assets at the Heiligenkreuz and Grimsby production sites significantly affected this result. These charges did not affect EBITDA.

Earnings before tax (EBT) stood at a loss of EUR 126.9 million, while earnings after tax reached a loss of EUR 130.3 million. After adjusting for impairment charges and restructuring costs, earnings after tax amounted to EUR 42.4 million, compared with a loss of EUR 10.8 million in the previous year.

Capital expenditure increased to EUR 97 million from EUR 93.2 million. Major investments included a new wood processing facility and a water supply improvement project at the Lenzing site.

Strategic Transformation and Cost Optimisation

Under its ‘Grow Nonwovens. Reset Textiles.’ strategy, Lenzing is realigning its business and production portfolio. The company plans to expand its nonwovens business, focus its textiles operations on premium and specialty applications, and strengthen its pulp and biorefinery activities.

At the same time, it is reducing its exposure to low-margin standard fibres and high-cost production sites.

Cost optimisation remains another key priority. After achieving savings of more than EUR 200 million in 2025, Lenzing aims to generate an additional EUR 120 million compared with the 2025 baseline. The company expects the full earnings impact of these measures by the end of 2027.

The programme includes annual personnel cost savings of EUR 45 million through a planned reduction of approximately 600 positions, mainly in administrative functions. By 30 September 2026, employment relationships representing more than 260 full-time equivalents had already been legally terminated. These measures are expected to generate annualised savings of EUR 27 million.

Lenzing also aims to save EUR 35 million through energy and operating expense optimisation. Further savings will come from production network adjustments and administrative cost reductions.

Production Network and Financial Strengthening

Lenzing is continuing the previously announced sales process for its Indonesian fibre production site as part of its global production network review.

The company also plans to stop production at Heiligenkreuz by the end of the first quarter of 2027. Production at Grimsby is scheduled to end by the close of 2027. Lenzing is evaluating options to maximise the value of these assets and has formally notified the Austrian Public Employment Service (AMS) about the planned workforce reduction at Heiligenkreuz.

In addition, Lenzing has made progress in strengthening its financial position. It completed a capital increase of approximately EUR 300 million in October 2026 and entered into new financing agreements totalling a further EUR 300 million. Around half of the new financing has already been contractually secured. The company expects to complete the implementation of these measures by the end of 2026.

Outlook for 2026 and Beyond

Lenzing plans to continue its strategic transformation throughout the remainder of 2026 and beyond. The company aims to expand its nonwovens business, maintain its position as an innovative textile fibre producer and replace more fossil-based materials with wood-based fibre solutions.

Planned initiatives include converting production capacity from textile fibres to nonwoven fibres, expanding its portfolio in hygiene and filtration applications, and developing new fibre products. In the textiles segment, the focus will remain on premium and specialty products, alongside strategic customer partnerships. Lenzing also plans to continue strengthening its pulp business.

Technologies such as TreeToTextile and LENZING™ Nonwoven Technology are expected to support growth across both business segments.

For the full year 2026, Lenzing expects adjusted EBITDA to reach between EUR 430 million and EUR 460 million, above the 2025 figure of EUR 425.6 million.

Over the medium term, the company aims to return to revenue growth, increase EBITDA by EUR 150 million, achieve an EBITDA margin of 20 to 25 per cent and reduce leverage to below 2.5 times. However, geopolitical and economic developments, along with the cyclical nature of the industry, may affect actual performance.