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Lenzing's cautious outlook depresses stock after in-line Q3


Reuters

VIENNA, Nov 15 (Reuters) - Austrian fibre maker Lenzing's cautious outlook for next year dragged its shares down more than 6 percent to a one-year low on Wednesday despite third-quarter results broadly in line with expectations.

Lenzing confirmed it expected its operating result for this year to be "significantly better" than last year, but pointed to limited visibility for next year's price developments in the fibre market.

"Overall market demand is expected to remain high. However, the group expects a substantial increase on the supply side, especially for viscose but also for cotton. Price trends for selected key raw materials... are difficult to predict," it said.

RCB analyst Teresa Schinwald said: "One the one hand new capacity in China is coming onto the market in 2018, on the other hand some commodity prices are rising. This leads to higher pressure on margins."

Analysts at Kepler Cheuvreux said that operating cash flow was "surprisingly weak" at 61.4 million euros.

Lenzing's earnings before interest, tax, depreciation and amortisation (EBITDA) in the quarter were stable year-on-year at 126.4 million euros ($149.6 million), only slightly missing the average estimate in a Reuters poll of analysts of 129 million.

Lenzing shares traded 6.4 percent lower at 102.60 euros at 0940 GMT.

($1 = 0.8449 euros)




This article appears in: Politics , Fundamental Analysis , Stocks , Earnings


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