“We now estimate the impact to second-quarter sales will be at least $100 million to $150 million, with half of that value currently expected to be recovered in the fiscal year,” the company said in a filing with the Securities and Exchange Commission. “However, the longer the coronavirus endures, the lower the likelihood of sales recovery this year.”
Earlier this month, Emerson predicted the coronavirus would reduce fiscal second-quarter revenue by $75 million to $100 million.
Revenue of $100 million represents 2.4% of Emerson’s first-quarter revenue total of $4.15 billion.
“For the full year, the ultimate impact of coronavirus in China and globally is uncertain,” the company’s filing said. “We are continuing to monitor and evaluate the impact of this evolving situation.”
All of Emerson’s “key” facilities in China are operational, with about 85% of capacity available on average, the company said.
It said more than 95% of its supply chain has restarted production, with current average capacity of about 57%. That number is steadily increasing.
Still, “logistics present a challenge,” Emerson said. “Material is moving but at approximately 75% of the normal rate. Additionally, transit times are delayed, and costing rates are predictably higher.”
More than 83,800 people in at least 53 countries have been infected with the coronavirus, and more than 2,860 have died.
At last check, Emerson Electric traded at $62.67, down 2.66%. The stock has dropped 8.3% over the last year.