After a negative year

Lenzing savings package costs 80 jobs in Austria

"We are cutting jobs, but at the same time we are also hiring people in sales," says Lenzing AG CEO Stephan Sielaff.(Bild: Barbara Kneidinger, Lenzing AG/Samuel Lee, Krone KREATIV)

How will Lenzing AG find its way out of the crisis? A self-imposed performance program is intended to reduce expenses, but this cannot be achieved without staff cuts. "We want to become 'best in class' in terms of 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 commented on the figures he presented for 2023, which showed a loss of 593 million euros.

Almost 8000 employees worldwide

With 7917 employees as of December 31, 2023, Lenzing AG kept its headcount almost unchanged in the previous year. In 2022, the fiber producer had reported a headcount of 7931. The company currently has 3,300 employees in Austria: 3,000 in Lenzing (Upper Austria) and 300 in Heiligenkreuz (Burgenland).

Has the fiber producer now left the valley of tears behind? "It's 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.

At the moment we are very focused on improving Lenzing's performance, increasing efficiency and boosting earnings. We want to be prepared for the market recovery and then benefit significantly from it.

Nico Reiner, Finanzvorstand der Lenzing AG

The current cost-cutting package, which is intended to reduce costs by more than EUR 100 million, will result in the loss of around 80 jobs in Austria - and thus in Lenzing and Heiligenkreuz, Sielaff calculated. The reduction will be achieved by not filling vacant positions, but also by deliberate redundancies.

More resilience
"We have a social plan," said the Lenzing CEO, who emphasized the determination in implementing the early measures: "On the one hand, we are keeping Lenzing on course, and on the other hand, we are increasing our resilience."

Relocation of 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 cutting development costs for projects and lower storage costs in China. The relocation of administrative activities to Paskov (Czech Republic) is also under review. "We are currently looking at this," says Sielaff.