Capital expenditures for intangible assets, property, plant and equipment, and biological assets (CAPEX) amounted to EUR 283.6 mn in the reporting year (down from EUR 698.9 mn in 2022) including due to the investment projects in China and Indonesia.
Since 2021, Lenzing has invested more than EUR 200 mn in production sites in China and Indonesia to convert existing capacity for generic viscose into capacity for specialty fibers in order to better serve structurally growing demand for environmentally responsible cellulosic fibers.
At Purwakarta (Indonesia), Lenzing successfully implemented reconstruction and modernization measures to convert to specialty viscose and significantly reduce specific emissions. Viscose fibers produced at the site under the LENZING™ ECOVERO™ and VEOCEL™ brands are marked with the EU Ecolabel,1 an internationally recognized eco label for environmentally responsible products and services.
In Nanjing (China), the conversion of a production line to TENCEL™ modal fibers for textiles and apparel was successfully completed in the first quarter of 2023. Lenzing is thereby able to offer locally produced TENCEL™ fibers to its Chinese customers for the first time. As a consequence of the conversion, the production site’s fiber portfolio now consists exclusively of specialty fibers. Moreover, Lenzing is working consistently on the gradual conversion of the Chinese site to green energy in order to further reduce carbon emissions.
The investment projects at the existing sites are in line with the Lenzing Group’s scientifically recognized and confirmed net zero target (see also the “Climate change” section in the non-financial statement).
In order to further reduce greenhouse gas emissions and at the same time become less dependent on external fossil fuels, Lenzing concluded a contract in 2023 to purchase a biomass power plant to supply the Heiligenkreuz site, as well as a supply contract for the purchase of wind energy for power supplies to the Lenzing site that are diversified and that offer stable prices.
1 The EU Ecolabel is recognized by all member states of the European Union as well as Norway, Liechtenstein and Iceland. Introduced in 1992 by an EU regulation (Regulation (EEC) No. 880/92), the voluntary label has gradually become a reference for consumers who wish to contribute to a lower environmental impact by purchasing more environmentally responsible products and services.