Fiber specialist Lenzing is back in the black

The listed Upper Austrian fiber manufacturer Lenzing can look back on a strong half-year. The clothing industry, which is picking up after the corona lull, needs more sustainable, wood-based special fibers again, especially viscose. EU laws, for example to avoid single-use plastic, are also a tailwind for biodegradable cellulose fibers such as Veocel from Lenzing.

This had a positive effect on the most important balance sheet figures in the first half of the year: sales rose by 27.5 percent to 1.03 billion euros, the profit for the period turned from a loss of 14.4 million in the first half of 2020 to a profit of 96.1 million Euro. The two large investment projects, the Lyocell plant in Thailand and the pulp mill in Brazil, are “on schedule and on budget” despite corona-related difficulties, according to Lenzing CEO Stefan Doboczky. Thailand will go into operation towards the end of the year, and Brazil by mid-2022.

Hygiene Austria completed

The company was very reluctant to comment on the inglorious episode with Hygiene Austria, the joint venture with Palmers for mask production, referring to the ongoing internal and official investigations into suspected commercial fraud and undeclared work. Lenzing transferred the shares in Palmers and deconsolidated a loss of 6.5 million euros and income tax relief of 1.6 million euros in the half-year balance sheet.

Lenzing has been striving for sustainability and circular economy for years. A “key project” is the traceability of the fibers back to the tree, said Doboczky. With the help of blockchain technology, the end consumer who buys a piece of clothing made from Tencel fiber can seamlessly trace which components are contained in it from which producers.

For the full year 2021, the group expects a result (Ebitda) of “at least 360 million euros” with more than 7,000 employees worldwide. That would be better than in the pre-crisis year 2019 with 327 million euros. (uru)