EANS-News: Lenzing AG / Lenzing Presents New Group Strategy "sCore TEN": Profitable Growth Thanks to Eco-Friendly Specialty Fibers

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Company Information

- Lenzing takes advantage of megatrends - Sustainability as a key
innovation and growth driver - Share of revenue generated by
specialty fibers targeted to rise to 50% by 2020 - EBITDA growth of
approx. 10% p.a. until 2020 - Increase in ROCE to more than 10% by
2020

The Lenzing Group is presenting its business strategy for the coming
years entitled "sCore TEN". Accordingly, Lenzing's main priorities
are strengthening the company's core business, intensifying
cooperation with customers along the value chain, increasing the
share of specialty fibers to 50% of total revenue by 2020, expanding
its quality and technological leadership for man-made cellulose
fibers and opening up new attractive business areas.

"Our objective is to safeguard and expand Lenzing's leadership role
on the dynamic growth market for man-made cellulose fibers", says
Lenzing's Chief Executive Officer Stefan Doboczky. "To achieve this,
we will focus more intensively on the most attractive segments in the
specialty fiber business. Lenzing will put value before volume in the
future. We aim at achieving volume growth."

Lenzing expects demand for man-made cellulose fibers to increase by 5
to 6% p.a. until 2020, which is nearly twice as fast as the global
fiber market. The primary factors driving demand are the continuing
growth of the world's population and rising prosperity in the
emerging markets. Forecasts call for a rise in per capita textile
consumption in the emerging markets by all in all 50% in the period
2010 to 2020. In the industrialized countries the nonwovens industry,
an important sales market for Lenzing, will profit from the increased
demand for hygiene products. The nonwovens segment is expected to
expand twice as fast as the textile market.

The new Lenzing strategy entitled "sCore TEN" was designed to take
account of the major megatrends. On the one hand, the name stands for
a resolute performance orientation (scoring) and for a strengthening
of Lenzing's core business operations (core) and on the other hand,
the new strategy reflects the objective of generating sustainable
growth with specialty fibers such as Lenzing Modal® or TENCEL® (TEN).
Five strategic measures comprise the cornerstones of sCore TEN:

- Strengthen the core: the target is to increase Lenzing's pulp
position through backward integration by increasing the Group's own
pulp production volumes and/or expanding strategic co-operations.
Lenzing will strive to expand upon its quality and technology
leadership. A program aimed at strengthening commercial processes is
designed to deliver a positive EBITDA contribution totaling EUR 50 mn
by the year 2017. The reorganization of the technical service units
will be concluded in 2016. - Customer intimacy: Lenzing plans to
establish regional competence centers for product innovations and
will move greater decision-making powers to the regions. These steps
will bring Lenzing closer to its customers. - Specialization:
Lenzing aims at generating 50% of total revenue from the business
with eco-friendly specialty fibers such as TENCEL®, Lenzing Modal®
and viscose fiber specialties by the year 2020. Lenzing will further
increase production capacities for TENCEL® depending on market
requirements. - Forward solutions: Lenzing will selectively enhance
its R&D activities along the value chain by new game-changing
technologies. - New business areas: Based on its core competencies,
Lenzing will open up new business areas.

In the light of the increasing demand for textile fibers one of the
major future challenges for the fiber industry is sustainability.
Lenzing boasts a major competitive advantage in this respect. Its
cellulose fibers originate in sustainably managed forests, are
produced in an environmentally-friendly manner and are biodegradable.
In particular, TENCEL® fibers are unrivalled on the marketplace when
it comes to sustainability. Taking all parameters into account,
TENCEL® is up to 17 times more environmentally compatible than other
fibers. Lenzing fibers are outstanding as blending partners for
cotton and polyester, and improve their sustainability.

"Compared to the previous year, we want to continually increase
EBITDA by 10% annually and aim to increase the return on capital
employed (ROCE) to more than 10% by 2020. At the same time, our
objective is to keep net financial debt at a level which is less than
2.5 times EBITDA", Doboczky explains in reference to the financial
performance targets of sCore TEN. Lenzing plans to finance all
necessary investments required to implement this strategy from its
own capital resources and simultaneously strive for a dividend payout
of up to 50% of the Group net profit.

Further inquiry note:
Lenzing AG
Mag. Angelika Guldt
Tel.: +43 (0) 7672-701-2713
Fax: +43 (0) 7672-918-2713
mailto:a.guldt@lenzing.com

end of announcement euro adhoc
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company: Lenzing AG

A-A-4860 Lenzing
phone: +43 7672-701-0
FAX: +43 7672-96301
mail: a.guldt@lenzing.com
WWW: http://www.lenzing.com
sector: Chemicals
ISIN: AT0000644505
indexes: WBI, ATX, Prime Market
stockmarkets: free trade: Berlin, official market: Wien
language: English