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Appendix: Notes on the Financial Performance Indicators of the Lenzing Group

The key financial indicators for the Lenzing Group are described in detail in the following section These indicators are derived primarily from the IFRS consolidated financial statements of the Lenzing Group and are found in this annual report, above all, in the sections “Selected indicators of the Lenzing Group” and “Lenzing Group Five-Year Overview”. The definitions of the indicators are summarized in the glossary to the annual report. The Managing Board believes these financial indicators provide useful information on the financial position of the Lenzing Group because they are used internally and are also considered important by external stakeholders (in particular investors, banks and analysts).

EBITDA, EBITDA margin, EBIT and EBIT margin

EBITDA and EBIT are viewed by the Lenzing Group as the benchmarks for the strength of operating earnings and profitability (performance) before and after depreciation and amortization. Due to their significance – also for external stakeholders – the EBIT is presented on the consolidated income statement and EBITDA is presented in the Financial Performance Indicators and, in order to provide a comparison of margins, in relation to group revenue (as the EBITDA margin and EBIT margin).

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before interest and tax (EBIT)

16.5

200.6

33.91

165.31

238.31

+

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

227.6

164.3

160.4

167.0

147.2

-

Income from the release of investment grants

(2.1)

(1.9)

(2.0)

(2.4)

(2.8)

Earnings before interest, tax, depreciation and amortization (EBITDA)

241.9

362.9

192.31

329.91

382.71

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before interest, tax, depreciation and amortization (EBITDA)

241.9

362.9

192.31

329.91

382.71

/

Revenue

2,565.7

2,194.6

1,632.6

2,105.2

2,176.0

EBITDA margin

9.4 %

16.5 %

11.8 %1

15.7 %1

17.6 %1

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before interest and tax (EBIT)

16.5

200.6

33.91

165.31

238.31

/

Revenue

2,565.7

2,194.6

1,632.6

2,105.2

2,176.0

EBIT margin

0.6 %

9.1 %

2.1 %1

7.9 %1

11.0 %1

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

EBT

EBT measures the pre-tax earnings strength of the Lenzing Group and is shown on the consolidated income statement.

Gross cash flow

In the Lenzing Group, gross cash flow serves as the benchmark for the company’s ability to convert gains/losses from operating activities (before changes in working capital) into cash and cash equivalents. This indicator is presented in the consolidated statement of cash flows.

Free cash flow

The free cash flow generated by the Lenzing Group shows the cash flow generated by operating activities – after the deduction of investments – which is available to service the providers of debt and equity. This indicator is also important for external stakeholders.

 
EUR mn

 

 

2022

2021

2020

2019

2018

Cash flow from operating activities

(43.2)

394.0

48.9

244.6

280.0

-

Cash flow from investing activities

(687.4)

(841.3)

(666.2)

(254.7)

(261.8)

-

Net inflow from the sale and disposal of subsidiaries and other business areas

0.0

0.0

0.0

0.0

(0.1)

+

Acquisition of financial assets and investments accounted for using the equity method

0.3

7.3

4.1

15.6

8.0

-

Proceeds from the sale/repayment of financial assets

(10.4)

(5.6)

(1.5)

(4.7)

(2.6)

Free cash flow

(740.7)

(445.5)

(614.8)

0.8

23.5

CAPEX

CAPEX shows the expenditures for intangible assets, property, plant and equipment and biological assets. It is presented in the consolidated statement of cash flows.

Liquid assets

Liquid assets show the Lenzing Group’s ability to meet due payment obligations immediately with available funds. This indicator is also used to calculate other financial ratios (e.g. net financial debt; see below).

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Cash and cash equivalents

446.9

1,113.3

1,070.0

571.5

243.9

+

Liquid bills of exchange (in trade receivables)

6.4

10.8

11.1

9.5

10.5

Liquid assets

453.3

1,124.1

1,081.1

581.0

254.4

Trading working capital and trading working capital to annualized group revenue

Trading working capital in the Lenzing Group is a measure for potential liquidity and capital efficiency. It is used to compare capital turnover by relating it to group revenue.

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Inventories

712.5

477.0

329.4

395.7

396.5

+

Trade receivables

293.6

325.2

249.7

251.4

299.6

-

Trade payables

(435.4)

(414.8)

(195.2)

(243.6)

(251.7)

Trading working capital

570.7

387.4

383.8

403.5

444.4

 
EUR mn

 

2022

2021

2020

2019

2018

Latest reported quarterly group revenue (= 4th quarter respectively)

595.5

606.1

437.7

487.3

539.8

x 4 (= annualized group revenue)

2,382.2

2,424.5

1,750.9

1,949.3

2,159.1

Trading working capital to annualized group revenue

24.0 %

16.0 %

21.9 %

20.7 %

20.6 %

Adjusted equity and adjusted equity ratio

Adjusted equity shows the Lenzing Group’s independence from the providers of debt and its ability to raise new capital (financial strength). This figure includes equity as defined by IFRS as well as government grants less the proportional share of deferred taxes. Adjusted equity is used to compare equity and debt with total assets. This (and/or a similar indicator) is occasionally used as a financial covenant by lenders.

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Equity

2,025.9

2,072.1

1,881.4

1,537.9

1,533.9

+

Non-current government grants

15.0

13.7

14.2

15.4

16.9

+

Current government grants

67.7

44.2

19.9

13.1

8.4

-

Proportional share of deferred taxes on government grants

(20.0)

(14.2)

(8.5)

(7.1)

(6.3)

 

 

 

 

 

 

 

Adjusted equity

2,088.6

2,115.7

1,907.0

1,559.3

1,553.0

/

Total assets

5,525.0

5,322.8

4,163.0

3,121.1

2,630.9

 

 

 

 

 

 

 

Adjusted equity ratio

37.8 %

39.7 %

45.8 %

50.0 %

59.0 %

Net financial debt, net financial debt/EBITDA, net gearing and net debt

Net financial debt is used by the Lenzing Group as the benchmark for its financial indebtedness and capital structure. It is also an important indicator for external stakeholders. The relation of this indicator to EBITDA shows the number of periods in which the same level of EBITDA must be generated to cover net financial debt. The ratio of net financial debt to adjusted equity (net gearing) illustrates the relation of net debt to adjusted equity. This (and/or a similar indicator) is occasionally used as a financial covenant by lenders. Net debt in the Lenzing Group measures the level of financial debt, including the provisions for severance payments and pensions.

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Current financial liabilities

250.3

120.1

105.6

129.6

166.2

+

Non-current financial liabilities

2,071.9

1,981.0

1,446.9

852.0

307.6

-

Liquid assets

(453.3)

(1,124.1)

(1,081.1)

(581.0)

(254.4)

 

 

 

 

 

 

 

Net financial debt

1,869.0

977.0

471.4

400.6

219.4

/

Earnings before interest, tax, depreciation and amortization (EBITDA)

241.9

362.9

192.31

329.91

382.71

 

 

 

 

 

 

 

Net financial debt / EBITDA

7.7

2.7

2.51

1.21

0.61

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Net financial debt

1,869.0

977.0

471.4

400.6

219.4

/

Adjusted equity

2,088.6

2,115.7

1,907.0

1,559.3

1,553.0

Net gearing

89.5 %

46.2 %

24.7 %

25.7 %

14.1 %

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Net financial debt

1,869.0

977.0

471.4

400.6

219.4

+

Provisions for severance payments and pensions

77.6

102.2

103.7

110.8

103.4

Net debt

1,946.6

1,079.3

575.0

511.4

322.8

Return on capital (ROE, ROI and ROCE)

Return on capital employed (ROCE) is the Lenzing Group’s benchmark for the yield (return) on the capital employed in the operating business. It is also an important indicator for external stakeholders. Return on capital (ROE) and return on investment (ROI) are profitability indicators which measure the earnings strength of the Lenzing Group.

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before interest and tax (EBIT)

16.5

200.6

33.91

165.31

238.31

-

Proportional share of current income tax expense (on EBIT)

54.8

(52.0)

(45.1)1

(60.7)

(57.8)

 

 

 

 

 

 

 

Earnings before interest and tax (EBIT) less proportional share of current income tax expense (NOPAT)

71.2

148.6

(11.2)1

104.71

180.61

/

Average capital employed

3,541.8

2,766.5

2,216.2

1,922.7

1,750.3

 

 

 

 

 

 

 

ROCE (return on capital employed)

2.0 %

5.4 %

(0.5) %1

5.4 %1

10.3 %

 

 

 

 

 

 

 

Proportional share of current income tax expense (on EBIT)

54.8

(52.0)

(45.1)1

(60.7)

(57.8)

Proportional share of other current tax expense

(87.6)

3.7

23.01

0.0

3.5

Current income tax expense

(32.8)

(48.4)

(22.1)

(60.7)

(54.3)

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

 
EUR mn as at 31/12

 

 

2022

2021

2020

2019

2018

Total assets

5,525.0

5,322.8

4,163.0

3,121.1

2,630.9

-

Trade payables

(435.4)

(414.8)

(195.2)

(243.6)

(251.7)

-

Non-current puttable non-controlling interests

(266.1)

(234.4)

(140.3)

0.0

0.0

-

Other non-current liabilities

(3.6)

(6.7)

(26.9)

(5.5)1

(5.3)1

-

Other current liabilities

(133.0)

(180.4)

(141.8)

(118.8)1

(141.0)1

-

Current tax liabilities

(27.9)

(38.3)

(2.4)

(20.7)

(10.4)

-

Deferred tax liabilities

(70.2)

(59.8)

(42.4)

(41.9)

(50.4)

-

Proportional share of deferred taxes on government grants

(20.0)

(14.2)

(8.5)

(7.1)

(6.3)

-

Current provisions

(66.3)

(39.1)

(25.7)

(14.4)1

(13.8)1

-

Non-current provisions

(91.5)

(118.2)

(120.4)

(128.3)1

(125.4)1

+

Provisions for severance payments and pensions

77.6

102.2

103.7

110.8

103.4

-

Cash and cash equivalents

(446.9)

(1,113.3)

(1,070.0)

(571.5)

(243.9)

-

Investments accounted for using the equity method

(26.5)

(24.8)

(29.1)

(29.2)

(13.4)

-

Financial assets

(41.4)

(71.1)

(40.9)

(41.8)

(36.7)

 

 

 

 

 

 

 

As at 31/12

3,973.8

3,109.9

2,423.2

2,009.1

1,836.3

As at 01/01

3,109.9

2,423.2

2,009.1

1,836.3

1,664.4

 

 

 

 

 

 

 

Average capital employed

3,541.8

2,766.5

2,216.2

1,922.7

1,750.3

1)

Reclassification of accruals from provisions to other liabilities in accordance with IAS 1 (see note 2 in the notes to the consolidated financial statements 2020).

 
EUR mn as at 31/12

 

2022

2021

2020

2019

2018

Adjusted equity 31/12

2,088.6

2,115.7

1,907.0

1,559.3

1,553.0

Adjusted equity 01/01

2,115.7

1,907.0

1,559.3

1,553.0

1,527.7

Average adjusted equity

2,102.2

2,011.4

1,733.2

1,556.1

1,540.3

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before tax (EBT)

(10.1)

182.9

22.3

163.8

199.1

/

Average adjusted equity

2,102.2

2,011.4

1,733.2

1,556.1

1,540.3

ROE (return on equity)

(0.5)%

9.1 %

1.3 %

10,5 %

12.9 %

 
EUR mn as at 31/12

 

2022

2021

2020

2019

2018

Total assets 31/12

5,525.0

5,322.8

4,163.0

3,121.1

2,630.9

Total assets 01/01

5,322.8

4,163.0

3,121.1

2,630.9

2,497.3

Average total assets

5,423.9

4,742.9

3,642.0

2,876.0

2,564.1

 
EUR mn

 

 

2022

2021

2020

2019

2018

Earnings before interest and tax (EBIT)

16.5

200.6

33.91

165.31

238.31

/

Average total assets

5,423.9

4,742.9

3,642.0

2,876.0

2,564.1

ROI (return on investment)

0.3 %

4.2 %

0.9 %1

5.7 %1

9.3 %

1)

Reclassification of capitalized borrowing costs, net interest from defined benefit plans and commitment fees from EBIT/EBITDA to the financial result (see note 2 of the consolidated financial statements as at December 31, 2022).

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