The Lenzing Group announced its earnings for the first half of fiscal year 2024 on Wednesday, reporting steady revenue growth year over year.
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The Austrian company, which makes fiber products like Tencel , EcoVero and Veocel , reported its revenue increased by 4.8 percent year over year, rising $1.43 billion in the first half of 2024 from $1.37 billion in the first half of 2023. It attributes that growth to a 9.3 percent increase in revenue from fibers.
The company’s earnings before interest, tax, depreciation and amortization (EBITDA) increased by 20.4 percent, the company said, coming in at $179.5 million at the end of the first half of 2024, as compared with $149 million for the first half of 2023.
Stephan Sielaff, CEO of Lenzing Group, said the company continues to progress at a steady rate.
“The Lenzing Group’s business performance continues to point in the right direction, even without a significant recovery in the relevant markets,” Sielaff said in a statement. “We are continuing to place pressure on expenditure within the organization, and at the same time we are focusing on measures to strengthen our global sales activities. We are taking action on a consistent and proactive basis, and we are making the Lenzing Group not only more profitable but also more resilient in the medium term.”
That growth in mind, the company has confirmed its guidance for fiscal year 2024, projecting higher year-on-year EBITDA. Despite the turmoil some sustainable fashion and fiber companies have experienced over the course of the past few months , the company said it remains optimistic about the potential for demand for more sustainable fibers to grow.
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Lenzing did not offer any other forward-looking insights; the company said “smoldering global conflicts, trade disputes and the uncertain outcome of elections ,” along with a “volatile” currency environment in the company’s most important regions, makes it difficult to accurately project financial circumstances.
Despite its reported successes, in April Lenzing revealed that its board voted to indefinitely suspend its dividend policy of at least 4.50 euros a share. It did not disclose the reason for that suspension.
In 2022, Lenzing began working to cut costs inside its organization. In the first half of 2024, it reported that its capital expenditures came in at $67.3 million, a decrease from $149.1 million in the first half of 2023. The company attributed the sharp drop in spending to “reduced investment activities.”
Nico Reiner, the company’s chief financial officer, said the cost-cutting plans have been going smoothly and may help the business navigate future uncertainties.
“The performance initiatives are showing visible results and are primarily aimed at improving EBITDA and generating free cash flow through stronger revenue and margin growth as well as sustainable cost excellence,” he said in a statement. “We expect an excess amount of 100 million euros, of which more than 50 percent will be effective from this financial year. The performance program is currently ahead of schedule.”
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