- The impact of COVID-19 has caused Celestica (TSX:CLS) to withdraw its financial guidance for 2020’s first quarter
- Authorities in the US and Malaysia have ordered Celestica’s operations there to stop, in reaction to the ongoing outbreak
- The company expects that these temporary delays will negatively impact its ability to operate, as well as its financial results
- Celestica intends to provide a revised update of 2020’s first quarter earnings in April
- Celestica’s share price has fallen 20.16 per cent, and is currently trading at $3.01 per share
Electronics manufacturing company Celestica (TSX:CLS) has withdrawn its financial guidance for 2020’s first quarter due to COVID-19 impacts.
The company initially provided financial guidance for 2020’s first quarter on January 29. At the time, Celestica was confident that what it disclosed was reflective of company circumstances.
However, the unanticipated disruptions and fears caused by the COVID-19 outbreak have created an atmosphere of great uncertainty. While the company (and the world) can only guess at COVID-19’s full duration and impact, Celestica has decided to withdraw the guidance.
The company has already been hit hard by the disease, and governmental measures to prevent its spread.
On March 16, multiple counties in California, USA, issued a “shelter-in-place” order. As a result, Celestica’s operations in Santa Clara and Alameda have had to stop on-site work temporarily, until April 7.
Overseas, the Malaysian government issued an order to close certain business activities, from March 18 to March 31. These measures are likely to negatively impact Celestica’s ability to manufacture products and receive essential parts from some suppliers.
Celestica’s President and CEO, Rob Mionis, commented on the company’s reaction to the uncertain times.
“While these government-mandated site closures are strong measures, we must do our part to support global efforts to contain COVID-19. We must help ensure the safety of our employees, suppliers, and customers.
Our efforts to date led to positive results in China, where our employee attendance rate is now over 90 per cent. While our global team has done exceptional work to date, the situation is fluid and continues to evolve,” he said.
Celestica is in regular contact with company suppliers and customers, gauging the ongoing impacts and risks of supply chain disruptions.
The company plans to provide an update on 2020’s first quarter earnings in a conference call on April 29, 2020.
Celestica’s share price has fallen 20.16 per cent, and is trading at $3.01 per share, as of 12:36pm EST.
