(new: share price updated)

COLOGNE (dpa-AFX) - The chemical group Lanxess has slipped into the red in the third quarter in a persistently difficult industry environment. Low demand from almost all industries and continuing, albeit slowing, destocking by customers continue to weigh on the Cologne-based company. The company's management, led by CEO Matthias Zachert, had only lowered its profit outlook at the beginning of the week.

As the MDax group announced on Wednesday, turnover in the three reporting months from July to September fell by almost 27 percent to 1.6 billion euros. Earnings before interest, taxes, depreciation and amortization as well as before special items plummeted by half to 119 million euros, as has been known since Monday. The bottom line for Lanxess was a minus of 131 million euros compared to a plus of 80 million euros a year earlier.

The company management around CEO Matthias Zachert now expects an operating result (adjusted EBITDA) of EUR 500 to 550 million - previously the target was EUR 600 to 650 million. Reasons for the latest target reduction include a surprisingly weak start to the final quarter as a result of customers in the agricultural industry beginning to reduce their inventories. Another negative factor was a supplier-related production cutback in the Flavors & Fragrances division at the Botlek site (Netherlands). In addition, the Group management proposed a reduction in the dividend from 1.05 euros to 10 cents per share. This is intended to reduce the high level of debt.

The recently very weak shares recovered in the middle of the week. With an increase of more than six percent to 23.58 euros, they even more than made up for the losses resulting from the lowered forecast at the start of the week.

In a commentary on the full quarterly figures, analyst Chetan Udeshi from the bank JPMorgan praised the free cash flow, which was high despite the surprisingly weak profit development. According to the Group, free cash flow improved from minus EUR 60 million to plus EUR 322 million compared to the same period last year. According to the analyst, Lanxess had made more progress in reducing working capital than he had expected. Companies can achieve this by reducing inventories, for example.

However, Lanxess shares are still one of the biggest losers in the mid-cap index this year with a loss of almost 38 percent./mis/tav/jha