How does Lenzing AG find a way out of the crisis? A self-imposed performance program is intended to reduce costs, which cannot be achieved without workforce cuts. “We want to become ‘best in class’ when it comes to cost excellence,” says CEO Stephan Sielaff. Read here what the fiber giant is doing to improve.
“We cannot be satisfied with the result and we are not.” This is how Lenzing CEO Stephan Sielaff responded to the figures he presented for 2023, which showed a loss of 593 million euros.
Has the fiber producer now put the valley of tears behind him? “It is difficult to say whether this is the bottom of the valley or not,” says CFO Nico Reiner, who speaks of a good start to the new year. “The volume development in the first two months was positive,” says Reiner.
As a result of the ongoing savings package, which is intended to reduce costs by more than 100 million euros, around 80 jobs will be lost in Austria – and therefore in Lenzing and Heiligenkreuz, Sielaff calculated. The reductions take place by not fulfilling new functions, but also by consciously implemented separations.
More resilience
“We have a social plan,” says Lenzing’s boss, who emphasizes the determination in implementing the measures taken at an early stage: “On the one hand we keep Lenzing on track and on the other hand we increase the resilience.”
Moving administrative activities to the Czech Republic?
The savings program includes more than 1,000 initiatives – from reducing steam consumption at the new plant in Thailand to reducing project development costs and reducing storage costs in China. The relocation of administrative activities to Paskov (Czech Republic) is also being tested. “We’re looking at that now,” Sielaff said.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
