EANS-News: Lenzing AG / Lenzing Group: Substantial Revenue and Earnings Increase in First Half-Year 2016

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6-month report

- Revenue up 8.3% to EUR 1,034.8 mn
- EBITDA rose 54.3% to EUR 195.1 mn
- Free cash flow tripled to EUR 228.3 mn
- Expansion program for specialty fiber production capacities started

Lenzing, August 24, 2016 - The Lenzing Group significantly improved
earnings in the first half-year 2016 compared to the first half-year
2015. The disciplined implementation of the new group strategy sCore
TEN with a clear focus on profitable growth based on environmentally
friendly specialty fibers impacts already noticeably the company's
business results. The Lenzing Group significantly increased revenue
and profitability and substantially improved the cash flow whilst
continuing the reduction of net debt.

At largely unchanged production volumes, consolidated revenue rose
8.3% to EUR 1,034.8 mn as a consequence of higher fiber selling
prices and an attractive product mix compared to the first half-year
of 2015. The Lenzing Group also profited from the increase of spot
market prices for viscose fibers. Consolidated earnings before
interest, tax, depreciation and amortization (EBITDA) improved by
54.3% to EUR 195.1 mn, boosting the EBITDA margin to 18.9% compared
to the prior-year level of 13.2%. Earnings before interest and tax
(EBIT) more than doubled to EUR 129.7 mn. The EBIT margin increased
to 12.5%, up from 6.3% in the previous year. The net profit for the
period increased by 83.9% to EUR 94.6 mn, and earnings per share were
up 76.2% to EUR 3.49. The Lenzing Group continues to show strong cash
generation momentum. The cash flow from operating activities more
than doubled to EUR 268.8 mn compared to the prior-year period. The
free cash flow rose three-fold to EUR 228.3 mn.

"The Lenzing Group looks back at a very successful first half-year
2016", says Stefan Doboczky, Chairman of the Management Board and CEO
of Lenzing AG. "On the one hand, we benefitted from a positive market
environment. On the other hand, we continued our implementation of
sCore TEN, our new group strategy, in a very disciplined and intense
fashion. We further optimized the product mix and profited from
higher selling prices thanks to ongoing strong demand for all Lenzing
fibers. All this was clearly reflected in our half-year 2016
business results, and therefore we also expect a substantial
improvement of our business performance for the full year compared to
2015."

Expansion of production capacities for specialty fibers As announced
on August 2, 2016, the Lenzing Group decided to expand its production
capacities for specialty fibers by a total of 35,000 tons by 2018
with an investment program amounting to EUR 100 mn. The capacity
increase will be mainly carried out at the Austrian sites in
Heiligenkreuz, Burgenland and Lenzing, Upper Austria. This decision
is the first step of the strategic investment program announced by
the Lenzing Group.

New TENCEL® recycling fiber about to be launched The Lenzing Group
has developed a new generation of TENCEL® fibers using cotton fabric
waste as a key raw material. This product combines the benefits of
the extremely environmental friendly production process of TENCEL®
fibers with an innovative raw material concept based on recycling. As
a result, the new fiber offers an exciting ecological footprint.
Inditex is the first retailer testing this innovative fibre. Other
brands will follow.

Outlook for 2016 The Lenzing Group expects a friendly market
environment for the global fiber industry in the second half of 2016.
The market for wood-based cellulose fibers is currently developing
especially favorably due to strong demand at stable supply.

The strong earnings figures for the first half of 2016 paired with
the positive market environment reinforces the optimism of the
Lenzing Group for the full year. Lenzing expects excellent business
results in the financial year 2016 and consequently a substantial
earnings improvement compared to the financial year 2015.

Key Group indicators(IFRS)
(in EUR mn) 1-6/2016 1-6/2015
Revenue 1,034.8 955.4
Earnings before interest,
tax, depreciation and 195.1 126.5
amortization (EBITDA)
EBITDA marginin % 18.9 13.2
Earnings before interest 129.7 60.5
and tax (EBIT)
EBIT marginin % 12.5 6.3
Net profit/loss for the 94.6 51.44
period
CAPEX(1) 40.6 26.0

June 30, 2016 Dec. 31, 2015
Adjusted equity ratio(2) in % 50.2
50.6(4)
Trading working capital(3) 361.6 447.4
Number of employees at 6,085 6,127
period-end

1) Capital expenditures: Equals acquisition of intangible assets, property,
plant and equipment as per statement of cash flows
2) Ratio of adjusted equity to total assets as a percentage
3) Inventories plus trade receivables less trade payables
4) Restatement according to IAS 8 (see note 2 in the consolidated interim
financial statements)

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Further inquiry note:
Lenzing AG
Mag. Waltraud Kaserer
Vice President Corporate Communications & Investor Relations
Tel.: +43 (0) 7672 701-2713
mailto:w.kaserer@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: office@lenzing.com
WWW: http://www.lenzing.com
sector: Chemicals
ISIN: AT0000644505
indexes: WBI, ATX, Prime Market
stockmarkets: official market: Wien
language: English