Lenzing will have 920,000 tonnes of man-made cellulosics capacity in 2013 and will sell off the plastics business. Viscose plus Tencel capacity will rise to 1,000,000 tonnes in 2014. The megatrends driving growth will continue uninterrupted.
The additional production capacities which will be available to the Lenzing Group for an entire year for the first time will serve as the basis for an increase in sales volumes by about 13.5% to 920,000 tons. As a result, sales are expected to climb to a range between EUR 2.15 bn and EUR 2.25 bn. This includes the decline in the external sales of the Business Unit Pulp totalling a further EUR 50 mn, which in turn is the consequence of the full-scale conversion of the Paskov pulp plant to manufacturing dissolving wood pulp for the Group’s internal requirements.
The anticipated decrease in average fiber selling prices in a year-on-year comparison to EUR 1.80 to EUR 1.90 per kilogram (2012: EUR 1.96/kg) will impact earnings directly. The earnings contribution achieved by the additional sales volumes is expected to be largely offset by cost increases for personnel, chemicals and other input factors.
For this reason, in the light of the assumed development of fiber prices, EBITDA of the Lenzing Group should range between EUR 260 mn and EUR 290 mn in 2013, and EBIT is expected to be in the range of EUR 140 - EUR 170 mn from today’s perspective. This corresponds to an expected EBITDA margin of about 12% - 13% and an expected EBIT margin of approximately 6% - 8% in the 2013 financial year.
Investments (CAPEX) are likely to total approx. EUR 260 mn, significantly below the comparable level of EUR 346 mn in 2012. Sales negotiations focusing on the divestment of the Business Unit Plastics, which is not part of Lenzing’s core business, are already at an advanced stage. Binding offers were submitted.
Lenzing will respond to the low market visibility in 2013 by optimizations of market activities, cost structures as well as replacement and maintenance investments. The targeted volume growth of the Lenzing Group reaching the threshold of about one million tons of annual fiber capacity by the year 2014 remains unchanged. However, new investment projects will be subject to scrutiny with respect to the planned timeline. In the medium- and long-term, all three megatrends on the fiber market (population growth, increasing wealth and sustainability) driving growth of the man-made cellulose fiber industry will continue uninterrupted. “However, we intend to flexibly adapt our pace of growth to current market conditions and place additional emphasis on cash management”, says Lenzing CEO Peter Untersperger.