Lanxess implements strategic measures to navigate weak market conditions

Cologne, Germany – LANXESS has announced a series of decisive actions to counteract a challenging global market environment that has significantly impacted its financial performance in the second quarter of 2025.

The company reported a 12.6% decline in sales year-over-year, totaling €1.47 billion, while EBITDA pre exceptionals fell by 17.1% to €150 million. These results reflect subdued demand across all business segments, reduced sales volumes, and the divestment of its Urethane Systems business unit, which was sold to Japan’s UBE Corporation in April. This sale marks the final step in LANXESS’s strategic exit from the polymer sector, reinforcing its focus on specialty chemicals.

Despite the downturn, LANXESS managed to generate a positive free cash flow of €31 million and reduced its net financial debt by 18%, aided by proceeds from the Urethane Systems sale, which were used to redeem a €500 million bond.

CEO Matthias Zachert emphasized the company’s readiness for future recovery, stating, “We remain fully focused on achieving the best possible positioning. When the economy picks up again, we will be ready.”

In light of continued market weakness and geopolitical uncertainties, including potential U.S. tariffs, LANXESS has revised its full-year EBITDA guidance to between €520 million and €580 million, down from the previous forecast of €600 million to €650 million.

To improve efficiency and reduce costs, LANXESS is optimizing its global production network. The company has accelerated the closure of its hexane oxidation facility in Krefeld-Uerdingen and plans to shut down its Widnes aroma chemicals site in the UK by 2026. Additionally, efficiency upgrades at the El Dorado bromine site in the U.S. are expected to yield annual savings of €50 million by the end of 2027.

Segment performance varied: the Consumer Protection division saw a decline in sales but an 8.8% increase in EBITDA due to a stronger product mix and cost savings. Meanwhile, Specialty Additives and Advanced Intermediates experienced drops in both sales and earnings, driven by weak demand and higher energy costs.