— By Marilyn Gerlach — 

German speciality chemicals producer Lanxess (Cologne; www.lanxess.com) has lowered its full-year financial forecast and announced plans to streamline operations at four production sites – including the closure of two – in response to weak global demand, which pushed the company further into the red in Q2. Net losses almost tripled, while core profit slumped by 17%.

Quarterly revenues fell by almost 13% to nearly EUR 1.47 bn, partly because of the sale of the Urethane Systems business unit in April. This divestment marked the company’s final exit from the polymer sector and last major step in its shift towards becoming a pure speciality chemicals player. Although the divestment removed a source of earnings, it enabled Lanxess to reduce its debt. In the first half of the year, revenues dropped 6.6% to EUR 3.067 bn.

“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,” said CEO Matthias Zachert, adding, “There is currently no improvement in sight for the economic situation.”

Related: Lanxess starts 2025 with stable sales 

Lanxess reported a second-quarter net loss of EUR 45 mn compared with a loss of EUR 16 mn in the same period last year. EBITDA, excluding one-offs, deteriorated 17.1% to EUR 181 mn. However, for the January to June period, the company managed to trim its net loss by 10.5% to EUR 102 mn, while EBITDA excluding one-offs remained stable at EUR 283 mn.

The group now expects full-year EBITDA to be between EUR 520 mn and EUR 580 mn. This includes a EUR 10 mn burden due to supply restrictions from a chlorine supplier. Previously, it had forecast EBITDA between EUR 600 mn and EUR 650 mn.

Lanxess joins a number of other groups that have revised profit forecasts, shut down facilities, or accelerated cost-cutting measures amid weak demand and uncertainty linked to US trade policy. Some of these companies are German chemical giants BASF and Evonik, plastics manufacturer Covestro, US chemical producer Chemours, French group Arkema, industry major Dow Chemical, as well as Orion Engineering Carbons and Orbia.

Lanxess said it has brought forward the closure of its hexane oxidation facility at Krefeld-Uerdingen, Germany, to the end of Q2 2025. In August 2023, when the Forward cost-savings programme was launched, it announced the shutdown would be implemented by 2026 at the latest. It noted then that the plant, which has 61 employees, was extremely energy-intensive and has a high CO₂ footprint.

A second facility it plans to close is the UK site at Widnes, which has been incurring high operating costs. According to the Q2 2025 analyst presentation, the planned closure is due to high underutilisation, with production to be shifted to other sites during 2026.

Related: Lanxess to have found buyer for PU prepolymers business

The Widnes site in England, one of three plants acquired through the Emerald Kamala Chemical purchase in 2021, is being closed in 2026 as part of the efforts to streamline Lanxess’s global aroma chemicals network.

According to the analysts’ charts, Lanxess also plans to improve production efficiency within the brine and bromine network at the El Dorado site in the US state of Arkansas – one of its largest plants in the country. Just what these measures are was not disclosed, with Lanxess only noting they are expected to result in permanent annual savings of EUR 50 mn from the end of 2026.

Lanxess acquired the three El Dorado plants as part of its Chemura takeover in 2017. The sites are involved in extraction and processing of elemental bromine that is used in flame retardants.

At Leverkusen, Germany, Lanxess plans to optimise production within its agrochemicals operations.

In terms of segment performance, the Specialty Additives segment saw a 7.0% reduction in sales to EUR 528 mn, while EBITDA without one-offs was trimmed by 17.1% to EUR 58 mn due to tepid demand from the construction industry and higher energy costs.

In the Advanced Intermediates segment, revenues declined 6.7% to EUR 446 mn. EBITDA excluding one-offs reached EUR 44 mn, down 24.1%.

The Consumer Protection segment was the strongest performer, with earnings rising 8.8% to EUR 87 mn – partly thanks to cost savings – despite a nearly 13% fall in revenues to EUR 489 mn.