As a result of the Covid-19 pandemic, Gunnebo is taking steps to meet the anticipated consequences and is adapting its operations to secure long-term financial stability. This means, among other things, temporary closure of production units in India and Italy in line with government decisions, as well as necessary capacity adjustments and cost reductions in the company's global operations. Gunnebo also foresees a decline in demand in the first quarter, to varying degrees in our Business Units, which is expected to continue into the second quarter of 2020.
Gunnebo is a global player whose security products and services are in some cases classified as important to society. This means focusing on maintaining deliveries and close cooperation with suppliers and partners as far as possible in order to minimize the consequences for the company's customers.
Gunnebo has temporarily closed production units in Halol (India) and Lavis (Italy) as a result of government decisions. The Group's other seven production units continue to operate, for example, the factory in Kunshan (China) has resumed production after a temporary closure. Furthermore, government decisions have also meant temporary closure of local sales and service operations in markets where there are strict restrictions on mobility.
Gunnebo will adapt its capacity to existing conditions, among other things, by evaluating state aid measures being offered in different countries. Locally, discussions with authorities and trade union representatives have been initiated to find flexible solutions that will enable retention of valuable skilled staff, thereby enabling us to support our customers in carrying out functions that are important for society.
The financial impact on Gunnebo and the production and delivery disruptions that result from this are currently being evaluated. During the current quarter and the upcoming quarter, we foresee lower demand for our products, services and service offerings. This, in turn, is expected to have a negative impact on profitability for the first quarter and the second quarter compared with the corresponding periods last year. In light of this, our business and cost base will be continuously adapted to ensure profitability, maintain capacity and a high level of service to our customers.
This information is information that Gunnebo AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, at 1 p.m. CET on 26 March 2020.
For more information, contact:
Åke Bengtsson, CFO, phone +46 (0)10-20 95 081
Isabelle Ljunggren, Director Investor Relations, phone +46 (0)10-20 95 099
The Gunnebo Group operates worldwide providing innovative products, software and services to control the flow of valuables, cash and people. Gunnebo offers entrance control, safe storage, cash management and integrated security solutions to customers primarily within retail, mass transit, public & commercial buildings, industrial & high-risk sites and banking. The Group has a turnover of MSEK 5,500 and is listed on NASDAQ Stockholm. www.gunnebogroup.com