EANS-Adhoc: Lenzing AG / Lenzing Group second quarter: Back to profit

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6-month report

24.08.2009

First half year influenced by global recession - revival of demand in
core business cellulose fibers

The Lenzing Group was not able to evade the impact of the global
recession of the first half year of 2009 but the company clearly
reversed the trend by generating a profit for the period of EUR 11.3
mill. in the second quarter, after a period net loss of EUR 5.4 mill.
in the first quarter.

Consolidated sales dropped by 14.4% from EUR 689.5 mill. to EUR 589.9
mill. compared to the first half year of 2008. Responsible for this
result were lower fiber production at the non-integrated sites in the
first quarter, markedly lower fiber prices and significantly lower
sales in segment Plastics.

EBIT for the first half year declined from EUR 72.1 mill. to EUR 15.4
mill. Quarterly earnings significantly improved from minus EUR 1.9
mill. in the first quarter to plus EUR 17.3 mill. in the second. The
profit for the period came to EUR 5.9 mill. (2008: EUR 46.8 mill.).

Peter Untersperger, chairman of the management board comments on the
current business development: "After the sharp collapse at the turn
of the year we are now witnessing a certain firming of the global
fiber market. Quantity demand has picked up recently, but prices are
still unsatisfactory despite adaptations and far below the levels of
the past record year." According to Peter Untersperger Lenzing again
benefits from its strategic focus on special fibers and the fact that
the company has reliably supplied its customers with fibers
throughout the difficult first quarter. Both factors allowed Lenzing
to run fiber production at full capacity in the second quarter,
resulting in improved second quarter results. Cost saving measures
implemented at the turn of the year already contributed to the recent
improvement of results as well.

As at 30 June 2009 the Lenzing Group employed a staff of 5,775 (31
December 2009: 5,945) with the decline mainly due to inevitable
capacity adaptation in the wake of overall economic developments.

Volatile business development in segment Fibers

The development of Lenzing´s core business fibers in the first half
of 2009 was, in line with the market trend, highly volatile. Business
Unit Textile Fibers focused on pushing high-quality special fibers in
order to counter the price pressure exerted on standard fibers. The
development of Business Unit Nonwoven Fibers, especially in the first
quarter, was affected by the generally weak economy. But here, too,
demand for cellulose nonwovens began to continuously rise in the
second quarter.

The fiber production facilities were operating at almost full
capacity by mid-year.

After the strong decline of pulp prices in 2008 prices recovered
slightly over the first six months of 2009. This was a consequence of
low pulp stock in the industry and a certain calming of the economy.

Decline in demand for Plastics, high level of order bookings for
Engineering

The business development of segment Plastics was affected by a marked
decline in demand due to the general economic situation. The trend
was slowed down in the second quarter but prices and produced
quantity are still at unsatisfactory levels with the exception of
niche products. The more favorable prices for precursor materials
could not compensate price pressure and weak quantity demand. Segment
Engineering in the first six months benefited from good order
bookings, with ongoing intra-group investment as a major contributing
factor.

Outlook

The Lenzing Group expects a tentative stabilization of sales and
results for the second half of the year. This expectation is based on
the recent recovery of quantity demand in business units Textile
Fibers and Nonwoven Fibers, as well as on the positive effect of
ongoing cost reduction measures. Unsatisfactory prices in segments
Fibers and Plastics will, however, result in a significant decline of
consolidated annual sales compared to previous year´s. The annual
result will be markedly below that of 2008.

Consolidated key figures (IFRS) in EUR mill. 1-6/2009 1-6/2008
Consolidated sales 589.9 689.5
EBITDA 53.2 107.3
EBIT 15.4 72.1
EBT 8.0 64.8
Profit for the period 5.9 46.8
EBITDA margin in % 9.0 15.6
EBIT margin in % 2.6 10.5
Gross cash flow 41.6 82.3
Investments (intangible assets and property,
plant and equipment) 78.4 66.3

30/06/2009 31/12/2008
Adjusted equity ratio* in % 40.8 42.7
Staff 5,775 5,945

*equity incl. government grants less deferred proportionate taxes

end of announcement euro adhoc
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ots Originaltext: Lenzing AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Lenzing AG

Mag. Angelika Guldt

Tel.: +43 (0) 7672-701-2713

Fax: +43 (0) 07672-96301

mailto:a.guldt@lenzing.com

Branche: Chemicals
ISIN: AT0000644505
WKN: 852927
Index: WBI
Börsen: Berlin / free trade
Wien / official dealing