Letter from the Managing Board

Dear ladies and gentlemen,
Dear partners, customers and employees,

When we look back on the year 2025, we see a year that demanded a great deal from us as the Lenzing Group – while at the same time demonstrating just how much strength, expertise and cohesion this company possesses. Overall conditions for the global textile and nonwovens industry remained challenging: geopolitical tensions were accompanied by changing trade tariffs, a volatile market environment and persistent cost and competitive pressure along value chains putting pressure on demand and prices.

Nevertheless, we managed to stabilize our business performance and set important strategic directions for the future. We have further focused our business model, expanded our position in strategic segments and sharpened our profile as a supplier of high-quality premium fibers. At the same time, we have made our organization more resilient, improved our cost position and invested where we can create the greatest long-term value for our customers, partners and owners. Our consistent performance program played a key role in supporting this development with cost savings of over EUR 200 mn. Additionally, further measures to improve the cost structure and efficiency, particularly in the personnel area, were decided upon in the third quarter of 2025. This will result in additional annual savings of EUR 45 mn, which will take full effect by the end of 2027 at the latest.

We are transforming Lenzing to become more profitable, resilient, and agile. Our goal remains unchanged: to act economically successful and ecologically and socially responsible.

The refinancing measures realized in the 2025 reporting year, consisting of syndicated financing of EUR 545 mn and the placement of a hybrid bond in the volume of EUR 500 mn, underscore the strategic and proactive focus on a sustainable capital structure and strengthening financial resilience.

In the third quarter of 2025, a strategic review of the production site in Indonesia was initiated to evaluate various options, including a possible sale. The resulting impairment had a negative impact on EBIT of EUR 82 mn.

The key financial figures for the business year 2025 confirm that we are on the right track with the transformation of the company. While revenue declined slightly by 2.3 percent year-on-year to EUR 2.6 bn, EBITDA improved by 4.5 percent to EUR 413 mn. At the same time, free cash flow increased to EUR 173.9 mn and unlevered free cash flow rose to EUR 279.6 mn, debt ratio was also further improved.

What has particularly impressed us as the Managing Board this year was the attitude with which our teams around the world contributed to this change: unwavering optimism, professionalism and the determination to find solutions together. This is exactly what makes Lenzing special. We combine in-depth technical expertise with a clear conviction: sustainably produced fibers made from renewable raw materials must form part of the answer to the global challenges of our time.

This is also reflected in the title of this year’s report: Lead Transformation – Generate Impact

The Lenzing Group is currently undergoing a transformation process in which we realign the company with a sharper focus on changing conditions in order to remain competitive. However, our goal remains unchanged: to operate in an economically successful as well as ecologically and socially responsible manner – and thereby creating added value and impact for our planet, our partners and our company. To achieve this, we are increasingly focusing on the strategic core pillars of premiumisation and excellence, and remain leading in innovation and sustainability. By consistently developing our business strategy, we are responding proactively to changing markets and the associated challenges, but also opportunities. After all, as a leading supplier of sustainable, cellulose-based premium fibers, we aspire to be and remain a driving force in the industry.

The Managing Board of the Lenzing Group