Notes on the Financial Performance Indicators of the Lenzing Group
Interim Report 01-03/2024
The key financial indicators for the Lenzing Group are described in detail in the following section. These indicators are derived primarily from the condensed consolidated interim financial statements and the consolidated financial statements of the previous year of the Lenzing Group. The Management Board believes these financial indicators provide useful information on the financial position of the Lenzing Group because they are used internally and are also considered important by external stakeholders (in particular investors, banks and analysts).
EBITDA, EBITDA margin, EBIT and EBIT margin
EBITDA and EBIT are viewed by the Lenzing Group as the benchmarks for the strength of operating earnings and profitability (performance) before and after depreciation and amortization. Due to their significance - also for external stakeholders - the EBIT is presented on the consolidated income statement and EBITDA is presented in the Financial Performance Indicators and, in order to provide a comparison of margins, in relation to group revenue (as the EBITDA margin and EBIT margin).
EUR mn | 01-03/2024 | 01-03/2023 |
Earnings before interest and tax (EBIT) | 1.5 | (41.4) |
Amortization of intangible assets,
- depreciation of property, plant and equipment and right-of-use assets and
depletion of | biological assets | 70.4 | 71.6 | ||||
Income from | the release of investment | ||||||
- grants | (0.5) | (0.5) | |||||
Earnings before interest, tax, depreciation | 71.4 | 29.7 | |||||
and amortization (EBITDA) | |||||||
EUR mn | 01-03/2024 | 01-03/2023 | |||||
Earnings before interest, tax, depreciation and | |||||||
amortization (EBITDA) | 71.4 | 29.7 | |||||
/ | Revenue | 658.4 | 623.1 | ||||
EBITDA margin | 10.8% | 4.8% | |||||
EUR mn | 01-03/2024 | 01-03/2023 | |||||
Earnings before interest and tax (EBIT) | 1.5 | (41.4) | |||||
/ | Revenue | 658.4 | 623.1 | ||||
EBIT margin | 0.2% | (6.6)% | |||||
EBT
EBT measures the pre-tax earnings strength of the Lenzing Group and is shown on the consolidated income statement.
Gross cash flow
In the Lenzing Group, gross cash flow serves as the benchmark for the company's ability to convert gains/losses from operating activities (before changes in working capital) into cash and cash equivalents.
EUR mn | 01-03/2024 | 01-03/2023 |
Net profit/loss after tax | (26.9) | (64.9) |
Amortization of intangible assets,
- depreciation of property, plant and equipment and right-of-use assets and
depletion of biological assets | 70.4 | 71.6 | ||
+/- | Change in the fair value of biological | |||
assets | (7.1) | (17.6) | ||
- | Income from the release of investment | |||
grants | (0.5) | (0.5) | ||
+/- Change in non-current provisions | (3.2) | (1.1) | ||
-/+ Income / expense from | deferred taxes | 2.1 | (13.9) | |
+/- | Change in current tax assets and | |||
liabilities | (11.0) | (6.9) | ||
Non-cash profit/loss from investments | ||||
+/- accounted for using the equity method | 1.7 | 3.3 | ||
-/+ Other non-cash income | / expenses | (31.4) | (25.8) | |
Other non-cash income | / expenses | (49.4) | (62.5) | |
Gross cash flow | (6.0) | (55.8) |
Free cash flow
The free cash flow generated by the Lenzing Group shows the cash flow generated by operating activities - after the deduction of investments - which is available to service the providers of debt and equity. This indicator is also important for external stakeholders.
EUR mn | 01-03/2024 | 01-03/2023 | ||||
Cash flow from operating activities | 120.7 | (47.7) | ||||
- | Cash | flow from investing | activities | (32.8) | (84.2) | |
Acquisition/disbursement | of financial | |||||
+ | assets | and investments accounted | for | 5.6 | 0.3 | |
using | the equity method | |||||
Proceeds from the sale/repayment of | ||||||
- | financial assets and the sale of | |||||
investments accounted for using the | ||||||
(6.1) | (0.8) | |||||
equity | method | |||||
Free cash flow | 87.3 | (132.3) | ||||
1 Interim Report 01-03/2024Lenzing Group
CAPEX
CAPEX is used in the Lenzing Group as a measure for the volume of investments in intangible assets, property, plant and equipment, and biological assets. This indicator is presented in the consolidated statement of cash flows.
Liquid assets
Liquid assets show the Lenzing Group's ability to meet due payment obligations immediately with available funds. This indicator is also used to calculate other financial ratios (e.g. net financial debt; see below).
EUR mn | 31/03/2024 | 31/12/2023 | ||
Cash and cash equivalents | 827.7 | 725.6 | ||
+ | Liquid bills of exchange | (in trade | ||
receivables) | 15.9 | 5.4 | ||
Liquid assets | 843.6 | 731.0 | ||
Trading working capital and trading working capital to annualized group revenue
Trading working capital in the Lenzing Group is a measure for potential liquidity and capital efficiency. It is used to compare capital turnover by relating it to group revenue.
EUR mn | 31/03/2024 | 31/12/2023 | |||
Inventories | 540.7 | 552.9 | |||
+ | Trade | receivables | 315.8 | 294.5 | |
- | Trade | payables | (339.2) | (296.3) | |
Trading working capital | 517.3 | 551.1 | |||
EUR mn | 2024 | 2023 | |||
Latest reported quarterly group revenue | 658.4 | 655.4 | |||
x 4 (= annualized group revenue) | 2,633.5 | 2,621.6 | |||
Trading working capital to annualized | |||||
group revenue | 19.6% | 21.0% | |||
Adjusted equity and adjusted equity ratio
Adjusted equity shows the Lenzing Group's independence from the providers of debt and its ability to raise new capital (financial strength). This figure includes equity as defined by IFRS as well as government grants less the proportional share of deferred taxes. Adjusted equity is used to compare equity and debt with total assets. This (and/or a similar indicator) is occasionally used as a financial covenant by lenders.
EUR mn | 31/03/2024 | 31/12/2023 | ||||
Equity | 1,688.4 | 1,742.2 | ||||
+ | Non-current | government grants1 | 13.7 | 14.1 | ||
+ | Current government | grants1 | 55.1 | 72.1 | ||
- | Proportional | share of | deferred taxes | on | ||
government | grants | (15.3) | (19.3) | |||
Adjusted equity | 1,741.9 | 1,809.1 | ||||
/ | Total assets | 5,323.7 | 5,214.6 | |||
Adjusted equity ratio | 32.7% | 34.7% | ||||
- This amount is included in the condensed consolidated statement of financial position in "other liabilties" (non-current, resp. current liabilities).
Net financial debt, net gearing and net debt
Net financial debt is used by the Lenzing Group as the benchmark for its financial indebtedness and capital structure. It is also an important indicator for external stakeholders. The ratio of net financial debt to adjusted equity (net gearing) illustrates the relation of net debt to adjusted equity. This (and/or a similar indicator) is occasionally used as a financial covenant by lenders. Net debt in the Lenzing Group measures the level of financial indebtedness, including the provisions for severance payments and pensions.
EUR mn | 31/03/2024 | 31/12/2023 | ||
Current financial liabilities | 545.3 | 529.0 | ||
+ | Non-current financial liabilities | 1,917.3 | 1,906.7 | |
- | Liquid assets | (843.6) | (731.0) | |
Net financial | debt incl. lease liabilities | 1,618.9 | 1,704.7 | |
- | Current | lease liabilities1 | (9.8) | (9.8) |
- | Non-current lease liabilities1 | (132.1) | (132.3) | |
Net financial | debt | 1,477.1 | 1,562.6 | |
EUR mn | 31/03/2024 | 31/12/2023 | ||
Net financial debt | 1,477.1 | 1,562.6 | ||
/ | Adjusted equity | 1,741.9 | 1,809.1 | |
Net gearing | 84.8% | 86.4% | ||
EUR mn | 31/03/2024 | 31/12/2023 | ||
Net financial debt | 1,477.1 | 1,562.6 | ||
+ | Current | lease liabilities1 | 9.8 | 9.8 |
+ | Non-current lease liabilities1 | 132.1 | 132.3 | |
+ | Provisions for severance payments and | 72.9 | 74.8 | |
pensions2 | ||||
Net debt | 1,691.9 | 1,779.5 | ||
- This amount is included in the condensed consolidated statement of financial position in "financial liabilities" (non-curre nt liabilities, resp. current liabilities).
- This amount is included in the condensed consolidated statement of financial position in "provisions" (non-current liabilities, resp. current liabilities).
2 Interim Report 01-03/2024Lenzing Group
Financial Glossary
Adjusted equity
Equity including non-current and current government grants less the proportional share of deferred taxes on these government grants.
Adjusted equity ratio
Ratio of adjusted equity to total assets in percent.
CAPEX
Capital expenditures; i.e. acquisition of intangible assets, property, plant and equipment and biological assets and acquisition of corporate units as per consolidated statement of cash flows.
FTE
Abbreviation for Full-Time Equivalents.
Gross cash flow
Gross cash flow equals cash flow from operating activities before change in working capital; the precise derivation can be found in the consolidated statement of cash flows.
IAS
Abbreviation for International Accounting Standard(s), which are internationally recognized accounting rules.
Earnings per share
The share of net profit/loss after tax attributable to the shareholders of Lenzing AG divided by the weighted average number of issued shares, calculated according to IFRS (IAS 33 earnings per share).
EBIT (earnings before interest and tax)
Earnings before interest and tax, or operating result; the precise derivation can be found in the consolidated income statement.
EBIT margin
EBIT as a percent of revenue; represents the return on sales (ROS).
EBITDA (earnings before interest, tax, depreciation and amortization)
Operating result before interest, tax, amortization of intangible as- sets, depreciation on property, plant and equipment and right-of-use assets and depletion of biological assets and before income from the release of investment grants.
EBITDA margin
EBITDA as a percent of revenue.
EBT (earnings before tax)
Profit/loss for the year (/the period) before income tax expense. The precise derivation can be found in the consolidated income state- ment.
Equity
The equity item aggregates the equity instruments as defined by IFRS. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. This represents the funds provided to the entity by its owners.
Free cash flow
Cash flow from operating activities less cash flow from investing activities less net cash inflow from the sale and disposal of subsidiaries and other business areas plus acquisition of financial assets and investments accounted for using the equity method plus disbursement of loans to joint ventures less proceeds from the sale/repayment of financial assets and the sale of investments accounted for using the equity method. Free cash flow corresponds to the readily available cash flow.
IFRS
Abbreviation for International Financial Reporting Standard(s), which are internationally recognized accounting rules.
Liquid assets
Cash and cash equivalents plus liquid securities and liquid bills of exchange.
Liquid funds
Cash and cash equivalents plus current securities.
Market capitalization
Weighted average number of shares multiplied by the share price as at the reporting date.
Net debt
Interest-bearing financial liabilities (= current and non-current financial liabilities) less liquid assets plus provisions for pensions and severance payments.
Net financial debt
Interest-bearing financial liabilitie s (= non-current and current financial liabilities) less lease liabilities less liquid assets.
Net gearing
Net financial debt as a percent of adjusted equity.
Net profit/loss after tax
Net profit/loss for the year (/the period). The precise derivation can be found in the consolidated income statement.
Post-employment benefits
Provisions for pensions and severance payments.
Total assets
Total of non-current and current assets or the total of equity and non- current and current liabilities. The precise derivation can be found in the consolidated statement of financial position.
Trading working capital
Inventories plus trade receivables less trade payables.
3 Interim Report 01-03/2024Lenzing Group
Trading working capital to annualized group revenue
Trading working capital as a percent of the latest reported quarterly group revenue x 4.
Working capital
Net current assets. Inventories plus trade receivables and other non- current and current assets less current provisions, trade payables and other non-current and current liabilities
4 Interim Report 01-03/2024Lenzing Group
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Lenzing AG published this content on 08 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 May 2024 05:36:06 UTC.