Lanxess (LXS) Q1 2026 earnings summary

Executive summary

• Q1 2026 began with a weak performance: sales declined 13.9% to €1,378 million and EBITDA pre exceptionals dropped 29.3% to €94 million, mainly due to weak demand, adverse FX, and the Urethane Systems divestment.

• Net income was negative at €141 million, compared to negative €57 million in Q1 2025; adjusted EPS was minus €0.50 versus €0.23 last year.

• Positive momentum was observed in March, aided by supply chain disruptions among Asian competitors and increased customer demand for European suppliers.

• Cost-saving measures and disciplined working capital management partially offset earnings pressure.

• Urethanes business is no longer consolidated, and a weaker dollar impacted year-over-year comparisons.

Financial highlights

• EBITDA pre exceptionals fell to €94 million from €133 million year-over-year, with margin declining to 6.8% from 8.3%.

• Net income dropped to -€141 million from -€57 million; adjusted EPS at -€0.50 versus €0.23.

• Free cash flow improved to -€29 million from -€111 million, reflecting tighter working capital management.

• Capex slightly decreased to €41 million from €45 million.

• Gross profit decreased to €262 million from €322 million year-over-year.

Outlook and guidance

• Full-year 2026 EBITDA pre exceptionals guidance is confirmed at €450–550 million.

• Q2 2026 EBITDA pre exceptionals expected to rise significantly to €130–150 million, with improved momentum seen from March.

• Cost savings initiatives and price increases are expected to ramp up in the second half, supporting full-year targets.

• Macro uncertainties persist, especially due to the Middle East conflict, FX headwinds, and inflation.

• Management expects a challenging market environment to persist, with potential recovery in construction in the second half.