The Development of Business in the Lenzing Group

In 2022, the Lenzing Group, like most of European manufacturing industry, was increasingly affected by extreme developments in global energy and raw material markets. The market environment deteriorated significantly in the third and fourth quarters, and worsening consumer sentiment placed an additional burden on Lenzing’s business growth.

In the year under review, revenue increased by 16.9 percent year-on-year to reach EUR 2.57 bn. This growth is primarily due to higher fiber prices, with currency effects supporting this price trend. The volume of fiber sold decreased, while the volume of pulp sold was up.

In addition to lower demand, the earnings trend particularly reflects higher energy and raw material costs. Earnings before interest, tax, depreciation and amortization (EBITDA) decreased by 33.3 percent year-on-year to EUR 241.9 mn in 2022. The EBITDA margin was down from 16.5 to 9.4 percent. Earnings before interest and tax (EBIT) amounted to EUR 16.5 mn (compared to EUR 200.6 mn in 2021) and the EBIT margin stood at 0.6 percent (compared to 9.1 percent in 2021). Earnings before tax (EBT) amounted to minus EUR 10.1 mn compared with EUR 182.9 mn in 2021).

Given this trend and the significant deterioration in the market environment, Lenzing launched a reorganization and cost reduction program in the third quarter. Implementation of the program is proceeding according to plan and is expected to save at least EUR 70 mn in costs per year once fully implemented.

The tax expense of EUR 27.2 mn (compared with EUR 55.2 mn in 2021) is influenced by currency effects due to the translation of tax items from the local to the functional currency and by the valuation allowance of tax assets of individual Group companies.

High level of investment activities

Gross cash flow decreased by 34.2 percent to EUR 244.8 mn in 2022, mainly due to the negative earnings trend. Cash flow from operating activities amounted to minus EUR 43.2 mn (compared with EUR 394 mn in 2021) due to the higher level of working capital. Measures initiated in the fourth quarter of 2022 had mitigated the increase in working capital by the end of the year. Free cash flow amounted to minus EUR 740.7 mn (compared with minus EUR 445.5 mn in 2021), which is particularly due to the high level of investment activities in connection with the key projects in Thailand and Brazil. Capital expenditure on intangible assets, property, plant and equipment and biological assets (CAPEX) amounted to EUR 698.9 mn in the year under review. Although this represents a year-on-year decrease of 17.2 percent, it is still one of the highest figures in the company’s history. Cash and cash equivalents decreased by 59.7 percent compared to December 31, 2021, to EUR 453.3 mn at the end of December 2022.

Total assets increased by 3.8 percent compared with December 31, 2021, to EUR 5.53 bn as of the end of 2022. The most significant changes relate to the increase in property, plant and equipment due to investment activities and the associated increase in financial liabilities.

Adjusted equity decreased by 1.3 percent to EUR 2.09 bn, reflecting the operating profit trend. As a consequence, the adjusted equity ratio stands at 37.8 percent. Net financial debt amounted to EUR 1.87 bn at the end of 2022 (compared to EUR 977 mn as of December 31, 2021). This increase was due in particular to the financing of the pulp project in Brazil. As a consequence, net gearing rose to 89 percent as of the reporting date (compared with 46.2 percent as of December 31, 2021). Trading working capital rose by 47.3 percent to EUR 570.7 mn, mainly reflecting an increase in inventories of EUR 235.6 mn due to higher manufacturing costs and the start-up of the new plants in Thailand and Brazil, as well as an offsetting positive effect of EUR 38 mn from the factoring program.

Details on revenue and earnings trends in the year under review are as follows:

Condensed consolidated income statement1
EUR mn














16.9 %

Cost of sales




27.8 %

Gross profit










Other operating income





Selling expenses




22.6 %

Administrative expenses




16.7 %

Research and development expenses




21.8 %

Other operating expenses




77.1 %











Financial result




49.9 %











Income tax expense





Net profit/loss for the year






Since the beginning of the 2021 financial year, the Lenzing Group has reported its consolidated income statement by applying the cost of sales method. The previous presentation was according to the nature of expense method. The complete consolidated income statement is presented in the consolidated financial statements.

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