EANS-Adhoc: Lenzing AG /

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3-month report

10.05.2012

Lenzing Group:
Good results in line with expectations in the first quarter of 2012

New record fiber shipment volumes
Weaker prices - Earnings below the prior-year quarter
Unchanged outlook for 2012

The performance of the Lenzing Group in the first quarter of 2012 was
in line with expectations. Average fiber selling prices, which were
down 11% on average compared to the first quarter of 2011 (minus 5.6%
from the fourth quarter of 2011), could be largely compensated on the
revenue side by a new record level of fiber shipment volumes. As a
result of the lower average fiber prices, quarterly earnings did not
match the particularly good results achieved in the prior-year
quarter.

Consolidated sales amounted to EUR 528.2 mn, and were at about the
same level as in the prior-year period, decreasing by 0.7% from EUR
532.1 mn in the first quarter of 2011. Earnings before interest, tax,
depreciation and amortization (EBITDA) in the first quarter of 2012
was down by 19.0% to EUR 93.1 mn (Q1 2011: EUR 114.9 mn), thus at a
satisfactory level and in line with the company's guidance. The
EBITDA margin thus amounted to 17.6% (Q1 2011: 21.6%). In addition to
the lower average fiber selling prices, slightly higher depreciation
led to a decline in the earnings before interest and tax (EBIT) of
25.9% to EUR 67.2 mn (Q1 2011: EUR 90.7 mn). This corresponds to an
EBIT margin of 12.7% in the first quarter of 2012 (Q1 2011: 17.0%).

"As expected, the market environment for the global fiber industry in
the first quarter was more difficult than in the first quarter of
2011, and similar to the situation prevailing in the fourth quarter
of 2011", says Lenzing CEO Peter Untersperger, explaining the
business development. "At present the global fiber market is facing a
consolidation phase at a higher level. In the first three months of
2012 Lenzing succeeded in maintaining the capacity utilization of its
production plants at over 95%, whereas volume demand on the market
for fibers adapted to the weak economic situation", Untersperger
continued. This development once again underscores the market and
quality leadership of the Lenzing Group.

The Lenzing Group is determinedly continuing with its strategic
capacity expansion program. Investments in intangible assets and
property, plant and equipment totaled EUR 52.9 mn in the first
quarter of 2012, up from the comparable prior-year level of EUR 41.9
mn. These investments primarily focused on construction of the fifth
fiber production line at the Indonesian subsidiary PT. South Pacific
Viscose (SPV) as well as ongoing capacity expansion efforts and
remodeling measures related to fiber and pulp production. The Lenzing
Group will invest a total of approx. EUR 1.6 bn by 2015, in order to
achieve annual production of about 1.2 mn tons of cellulose fibers.

Adjusted equity at the end of March 2012 rose by 4.9% to EUR 1,099.5
mn. This corresponded to an adjusted equity ratio of 46.8% of total
assets. In spite of the extensive investments being made, net
financial debt could be reduced to EUR 125.6 mn (end of 2011: 159.1
mn), confirming the high self-financing capacity of the Lenzing
Group. Accordingly, net gearing further declined to a new record low
of only 11.4% (End of 2011: 15.2%).

Outlook Lenzing confirms its guidance for the 2012 fiscal year
announced at its annual results press conference. Accordingly, 2012
should be a good year, but will not be able to match the record
results posted in 2011. Quarterly business could develop in a
mirror-inverted manner compared to 2011, with second-quarter EBITDA
likely to total about EUR 100 mn.

A further increase in volume demand and accompanying higher fiber
prices compared to the first quarter are anticipated in the second
half of 2012 against the backdrop of an improved global economic
situation. Most recently there were positive signals relating to
private consumption in China and the moderate recovery of the U.S.
economy. In addition, market experts see positive price impetus
arising as a result of lower harvest expectations for cotton in the
coming cotton marketing year.

Fiber shipment volumes on the part of the Lenzing Group are likely to
increase to about 810,000 tons for the entire 2012 fiscal year,
serving as the basis for consolidated sales to climb to a level
between EUR 2.2 bn and EUR 2.3 bn, despite the lower average fiber
selling prices. Depending on the development of fiber and raw
material prices as well as the global economy, Lenzing confirms its
original outlook of an EBITDA between EUR 400 mn and EUR 480 mn, and
an EBIT ranging between EUR 285 mn and EUR 365 mn in 2012.

Key Group indicators (IFRS)
in EUR mn 1-3/2012 1-3/2011
Consolidated sales 528.2 532.1
EBITDA 93.1 114.9
Earnings before interest and tax (EBIT) 67.2 90.7
Earnings before tax and minority
interest (EBT) 66.6 84.8
Profit for the period 48.4 66.9
EBITDA margin in % 17.6 21.6
EBIT margin in % 12.7 17.0
Gross cash flow 73.9 89.7
Investments in intangible assets and
property, plant and equipment (CAPEX) 52.9 41.9

31/03/2012 31/12/2011
Adjusted equity ratio* in % 46.8 44.8
Employees** 6,678 6,444

*Equity incl. government grants less prop. deferred taxes
** FTE's

Segment reporting in EUR mn 1-3/2012 1-3/2011
Segment Fibers
Sales 474.4 481.4
EBITDA 87.2 109.7
Earnings before interest and tax (EBIT) 62.5 86.9
Segment Plastics Products
Sales 43.4 44.9
EBITDA 3.9 3.3
Earnings before interest and tax (EBIT) 2.5 1.6
Segment Engineering
Sales 30.0 30.8
EBITDA 2.5 2.6
Earnings before interest and tax (EBIT) 2.1 2.2

Further inquiry note:
Lenzing AG
Mag. Angelika Guldt
Tel.: +43 (0) 7672-701-2713
Fax: +43 (0) 07672-96301
mailto:a.guldt@lenzing.com

end of announcement euro adhoc
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issuer: 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