Lanxess to close sites in weak market

Lanxess has revealed plans for “further optimising its global production network” because of the weak market environment. It made the announcement during its Q2 results release, which showed a significant fall in sales.

The company will to streamline its global network of aroma chemicals plants and shut down production at Widnes, UK, during 2026. It explained that it can no longer operate the site competitively due to high costs. Widnes was part of the Emerald Kalama acquisition and employs around 100.

At Lanxess is planning to increase the efficiency of bromine production at El Dorado, US, by unspecified means, with the aim of permanent annual savings of EUR 50 million/year from the end of 2027.It had already brought forward the closure of its hexane oxidation facility at the Krefeld-Uerdingen site in Germany.

In Q2, Lanxess saw sales shrink by 12.6% year-on-year to  €1.47 billion “due to portfolio and volume effects”, as well as the sale of the Urethane Systems business unit with effect from 1 April. EBITDA before exceptionals was down 17.1% to €150 million and the company adjusted its full-year forecast for this measure down from €610-650 million to €520-580 million.

“The economic environment has deteriorated significantly again in recent months. Additionally, ongoing tariff discussions with the US are causing considerable market uncertainty and exacerbating the situation for the European chemical industry. There is currently no improvement in sight for the economic situation,” said CEO Matthias Zachert. 

“For us, this means continuing to focus fully on achieving the best possible positioning in the market, as well as in terms of costs, structures, and processes. When the economy picks up again, we will be ready and able to meet the additional demand much more efficiently and profitably.”

All three segments were hit in Q2, with Consumer Protection seeing a 12.8% fall in sales €489 million, although EBITDA pre-exceptionals increased by 8.8% to €87 million. Specialty Additives saw sales fall by 7.0% to €528 million and EBITDA pre-exceptionals by 17.1% to €58 million, largely due to weak demand from the construction industry and higher energy costs.