10. Amortization of intangible assets, depreciation of property, plant and equipment and right-of-use assets and depletion of biological assets

Amortization of intangible assets, depreciation of property, plant and equipment and right-of-use assets and depletion of biological assets include the following:

Impairment

In the financial year 2025, impairment losses of EUR 81,953 thousand were allocated to cost of sales (EUR 80,121 thousand), selling expenses (EUR 1,344 thousand) and administrative expenses (EUR 487 thousand). The impairment losses in the 2024 financial year amounting to EUR 3,751 thousand were included in administrative expenses in full.

The impairment losses recognized in the 2024 financial year relate to a right-of-use asset for land of an Indian subsidiary that was established for the purpose of constructing a viscose fiber plant in India. This project was no longer pursued due to legal delays and the deterioration in the market environment. Alternative utilization options for the assets held by the company were evaluated. The recoverable amount (EUR 1,740 thousand) led to an impairment loss of EUR 3,751 thousand on land and buildings. The impairment is allocated to the Segment Division Fiber.

Impairment of intangible assets, property, plant and equipment, right-of-use assets and cash-generating units (CGUs)

If there is an indication of impairment in accordance with IAS 36, intangible assets, property, plant and equipment and right-of-use assets as well as cash-generating units (CGUs) are tested for impairment. A qualitative and quantitative analysis is performed at the reporting dates for all consolidated financial statements and interim consolidated financial statements to determine whether there are any indications of impairment or any material year-on-year changes in impaired CGUs. This analysis is based on criteria defined by the management of Lenzing AG. Intangible assets, property, plant and equipment and right-of-use assets allocated to a CGU that includes goodwill are tested during the annual impairment testing of goodwill. The CGUs in the Lenzing Group represent, above all, the individual production sites.

The Lenzing Group initially determines the recoverable amount based on the applicable fair value less costs of disposal. The budget is approved by the Management Board and the Supervisory Board. The medium-term plans for the subsequent four years are approved by the Management Board and acknowledged by the Supervisory Board. These plans are the starting point for the cash flow projections on a post-tax basis to determine the fair value less costs of disposal. Basically, the management prepares planning accounts over a detailed planning period of five years. If the steady state is not already achieved at the end of the five-year detailed planning period, this period will be extended until a steady state of cash flows can be assumed. Subsequently, a perpetuity growth rate reflecting a sustainable long-term growth rate is applied after the detailed planning period. The estimate for the sustainable long-term growth rate generally equals half of the inflation rate expected in the relevant country during the next few years, as projected by an international economic research agency. This value usually tends to offset general inflation. A growth-related retention of financial surpluses in the perpetual annuity is taken into consideration in the planning calculations. In addition, the risks listed in the group management report are incorporated into the planning calculations. The planned/projected cash flows are discounted to their present value with a discounted cash flow method. Fair value measurement is classified in full as level 3 of the fair value hierarchy because key input factors (in particular, cash flows) cannot be observed on the market. The applied discount rate is calculated on an individual basis using the capital asset pricing model (CAPM) and represents a composite figure (weighted average cost of capital – WACC) that combines the average interest rate for debt and the anticipated return on equity employed. After-tax WACCs ranging from 8.1 percent to 8.9 percent were used in 2025 (2024: 8.4 percent to 9.0 percent) for impairment tests of CGUs that include goodwill.

The WACCs were, for the most part, determined on the basis of externally available capital market data for comparable companies (in particular, to determine the risk premium). The planning and forecasts of free cash flows are based, above all, on internal and external assumptions for the expected development of selling prices and volumes (especially for fibers and cellulose) and the related costs (in particular, raw materials like cellulose, wood and energy plus labor and taxes), including the expected market environment and market positioning. Other input factors include anticipated investments and the changes in working capital. These internal assumptions are based on past experience, current operating results and the assessment of future developments. They are supplemented by external market assumptions such as sector-specific market studies and economic outlooks.

In the financial year under review, impairment losses in accordance with IAS 36 were recognized for the CGU Fiber Site Indonesia in the amount of EUR 81,953 thousand. No impairments of CGUs in accordance with IAS 36 were recognized in the 2024 financial year.

In the 2025 and 2024 financial years, no significant changes were identified for impaired CGUs compared to the previous year that would have led to a reversal of impairment.

Impairment test of the CGU Fiber Site Indonesia

The CGU Fiber Site Indonesia produces viscose fibers in Purwakarta, Indonesia. The deterioration of the market environment, which was primarily influenced by the effects of country-specific US tariff policy, has led to substantial losses for the Fiber Site Indonesia CGU. In addition, a resolution was passed in the third quarter of the 2025 financial year to review the strategic options for the site in Indonesia, including a possible sale. This triggered an indication of impairment in accordance with IAS 36 for the CGU Fiber Site Indonesia. As a consequence, the recoverable amount of the non-current assets, in particular property, plant and equipment, was determined. The fair values less costs to sell of the individual assets represent the lower limit for the impairment. The calculated fair value less costs to sell (EUR 13,207 thousand) resulted in an impairment requirement in the amount of EUR 81,953 thousand. Impairment losses were applied to land and buildings in the amount of EUR 24,012 thousand, to technical equipment, machinery, operating, and office equipment in the amount of EUR 54,837 thousand, and to advance payments and assets under construction in the amount of EUR 3,103 thousand. All assets are allocated to the Fiber Division segment.

As the lower limit for any further potential impairment loss is represented by the fair value less costs to sell, an adjustment of the discount rate (WACC) would not have led to any further impairment loss.

In the 2024 financial year, the recoverable amount of the CGU Fiber Site Indonesia was determined due to an indication of impairment in accordance with IAS 36. The recoverable amount provided sufficient coverage of the carrying amounts. This resulted in sufficient coverage of the carrying amounts.

Impairment test of the CGU Fiber Site China

CGU Fiber Site China produces viscose and modal fibers in Nanjing, China. Due to an indication of impairment as per IAS 36, the recoverable amount of the CGU Fiber Site China was determined for the 2025 financial year. The recoverable amount was sufficient to cover the carrying amounts.

Impairment test of CGUs to which goodwill is allocated

Goodwill was allocated to the following segments/cash-generating units (CGUs) as at the reporting date:

The recoverable amount of the largest CGU with goodwill in 2025 – the CGU Pulp Site Czech Republic – was determined on the basis of fair value less costs of disposal. The measurement of fair value is classified in full under level 3 of the fair value hierarchy. The following individual assumptions from the most recent impairment tests were used for annual testing:

The average revenue growth of the Pulp Site Czech Republic during the detailed planning period equals 2.2 percent per year (2024: 1.7 percent per year).

The estimated fair value less costs of disposal of the CGU Pulp Site Czech Republic exceeds the carrying amount by EUR 43,720 thousand (2024: EUR 199,054 thousand). The following table shows a sensitivity analysis with hypothetical scenarios for the key assumptions as well as the possible changes in value as at the reporting date which, if they occurred, would result in the recoverable amount equaling the carrying amount of the CGU plus goodwill.

The other CGUs with goodwill include the CGU Fiber Site UK, the CGU Fiber Site Heiligenkreuz, and the CGU Fiber Site USA. For these, a long-term growth rate of 1.0 percent to 1.2 percent (2024: of 1.0 percent to 1.2 percent) was taken into account as perpetual yield.

In addition to the annual impairment test for CGUs with goodwill, in the 2025 and 2024 financial years an additional indication of impairment in accordance with IAS 36 was identified at the CGU Heiligenkreuz Fiber Site due to the deterioration in the market environment, which has an impact on the volume and price structure of the fibers produced, and the recoverable amount was determined accordingly. This resulted in sufficient coverage of the carrying amounts in both years. The average EBITDA growth of the CGU Fiber Site Heiligenkreuz during the detailed planning period was a multiple of that in perpetuity in the 2025 financial year as well as in the 2024 financial year. The operating margin of the CGU Fiber Site Heiligenkreuz amounts to 3.2 percent (2024: 3.9 percent) and could decrease by a maximum of 0.5 percentage points (2024: 0.7 percentage points) so that the carrying amounts are sufficiently covered by the recoverable amount. The discount rate (WACC) amounts to 8.1 percent (2024: 8.4 percent) and could increase by a maximum of 1.0 percentage points (2024: 1.4 percentage points). The determined recoverable amount would increase by EUR 54,761 thousand or decrease by EUR 54,958 thousand if the planned EBITDA increased (decreased) by 20 percent. In the event of a 10 percent reduction in EBITDA, the recoverable amount would be EUR 32,924 thousand below the carrying amounts.

The planned EBITDA was estimated on the basis of past experience, with the following key assumptions:

• The revenue growth is dependent on the CCF price derivation including premiums for special products. This assumes an ongoing premiumization of the portfolio, resulting in average growth of 6.2% in the detailed planning period.

• The planned investments include one investment in the detailed planning period that will lead to potential savings and consequently exert a significant impact on the planned EBITDA.