Lenzing Returns To Profit In Q1 2026, Free Cash Flow More Than Doubles
The Lenzing Group has reported a return to profitability in the first quarter of 2026, posting a net profit of EUR 24 million after three consecutive loss-making quarters in 2025. The company also delivered a strong improvement in free cash flow, reflecting the impact of its ongoing transformation and performance enhancement measures.
EBITDA for the quarter stood at EUR 116.3 million, while free cash flow more than doubled to EUR 33.8 million compared to EUR 14.8 million in the corresponding period last year. Revenues, however, declined 10.8 percent year-on-year to EUR 615.7 million due to lower fiber sales volumes, softer fiber and pulp prices, and strategic curtailment of less profitable production lines.
“During the first quarter of 2026, we further stabilized our operational development and returned to a positive net result after economically challenging previous quarters. The significant improvement in free cash flow is particularly encouraging and demonstrates that our measures are taking effect,” said Mathias Breuer, CFO of the company.
Despite continued pressure from volatile energy costs, geopolitical tensions and weak global demand, Lenzing said disciplined pricing, cost optimization and working capital management helped stabilize earnings. Compared to the second half of 2025, the company witnessed a clear improvement in operational performance and pricing momentum.
The EBITDA margin for the quarter stood at 18.9 percent against 22.6 percent in Q1 2025. EBITDA included positive one-off effects of EUR 25.7 million arising from the sale of surplus EU emission allowances and the acquisition of a majority stake in TreeToTextile AB. Lenzing said the acquisition supports its premiumization strategy and strengthens its position in next-generation specialty fibers.
EBIT reached EUR 40.1 million, while earnings before tax (EBT) stood at EUR 22.8 million. The company reported tax income of EUR 1.2 million, mainly driven by currency translation effects.
Lenzing continued to advance its comprehensive performance program aimed at improving profitability, resilience and cash generation. The company achieved savings exceeding EUR 200 million during FY2025 through cost optimization, operational efficiency initiatives and tighter working capital control. The strategy also includes focusing on higher-margin products, expanding into new markets and strengthening customer acquisition.
Cash flow from operating activities increased to EUR 94.6 million in Q1 2026 from EUR 72 million a year earlier, supported by inventory reduction and improved working capital management. Capital expenditure during the quarter amounted to EUR 28.4 million.
As of March 31, 2026, cash and cash equivalents remained stable at EUR 690.1 million, while net financial debt stood largely unchanged at EUR 1.36 billion. Total assets increased to EUR 4.65 billion and the adjusted equity ratio improved to 29.9 percent.
Looking ahead, Lenzing cautioned that the global business environment remains uncertain. The company highlighted rising geopolitical risks, particularly the Middle East conflict, which is expected to increase energy and raw material costs while impacting inflation and consumer demand. Given the prevailing volatility and trade policy uncertainties, Lenzing said it is currently unable to provide a reliable forecast for the 2026 financial year.
