Continental has withdrawn its outlook for the current financial year due to the ongoing uncertainty in the market after the coronavirus pand...
Continental has withdrawn its outlook for the current financial year due to the ongoing uncertainty in the market after the coronavirus pandemic. Over 40 per cent of Continental's 249 manufacturing locations across the word have temporarily ceased activities and about 30,000 employees have registered for short time work in Germany from April 1, 2020. The company had recorded consolidated sales of around 9.8 billion Euros in the first quarter and has adjusted its EBIT margin of around 2 to 3 per cent. Earlier, Continental had anticipated consolidated sales for the current year at around 44.5 billion Euros and an adjusted EBIT margin of around 5.5 to 6.5 percent.
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Dr. Elmar Degenhart, CEO, Continental AG said, "In periods of crisis, financial liquidity is of top priority. To this end, we are cutting our costs, optimizing our working capital and postponing projects and investments that are not urgently required until further notice. Our most urgent goal is to further reduce the cash outflow substantially in light of the challenging market development. The numerous steps we have taken are in line with the respective market requirements and the regulations issued by local authorities. We are also coordinating with employee representatives."
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The cutback in production affects in specific locations in Europe as well as in North and South America. In China, the company halted production at its plants after the outbreak of the coronavirus, complying with local regulations.
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