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Guidance Updates and Withdrawals Sharply Increase as Pandemic Spreads

AlphaSense Staff

As COVID-19 spreads beyond China to countries throughout the globe, company commentary on the virus’ widespread impact showed a drastic increase. What at first seemed to be an isolated issue, quickly started to affect every industry and management responses ranged from holding their guidance, to stating uncertainty and refusing to comment, or adjusting or withdrawing previous positions entirely. To understand which companies have been commenting on guidance and what positions they’ve taken overtime, take a look at company commentary we’ve compiled below. 

AS-Coronavirus-Guidance-Chart

Takeaways:

  • Companies have been withdrawing guidance since February with a huge spike since mid-March
  • The pace of commentary quickened the week of March 9th due to major airlines and travel sites pulling guidance within a few days of each other
  • Consumer discretionary brands are withdrawing guidance at a rapid pace as stores close, unemployment increases and fears of weakening consumer demand rise
  • Some companies are providing updates on adjusted guidance, sharing a wider than normal range or simply stating that they’re expecting negative impacts, however most are waiting until next Earnings to share full COVID-19 impact and renewed guidance 
  • Many companies backed away from the question of guidance by stating uncertainty while others chose to hold firm on their Q1 projections despite unpredictable markets

AlphaSense can track management commentary on guidance in real-time across the entire market, by industry, or watchlist. We expect this to be an interesting theme to follow as Q1 earnings season begins in a few weeks. Start your free trial of AlphaSense now or login to your account. 

Note: Adjustments status accounts for companies calling wider than normal guidance and commenting on lowered expectations without guiding to a certain range

Company

Sector

Date

Status

Omnicom

Communication Services

3/25

Uncertain

Nike

Consumer Discretionary

3/25

Uncertain

Federal Realty Investment Trust

Real Estate

3/25

Withdraw

Mid America Apartment Communities

Real Estate

3/25

Withdraw

Anhueser Busch Inbev

Consumer Staples

3/25

Withdraw

McDonald's

Consumer Discretionary

3/25

Uncertain

Elanco

Healthcare

3/24

Withdraw

Ambev

Consumer Staples

3/24

Withdraw

Mastercard

Financials

3/24

Withdraw

PACCAR

Industrials

3/24

Adjustments

Chevron

Energy

3/24

Adjustments

Albemarle

Materials

3/24

Uncertain

IHS Markit

Industrials

3/24

Adjustments

Suncor

Energy

3/24

Adjustments

GM

Industrials

3/24

Withdraw

Square

Financials

3/24

Withdraw

Agnico Eagle Mines

Materials

3/24

Withdraw

Bell

Communication Services

3/23

Uncertain

Thermo Fischer Scientific

Healthcare

3/23

Uncertain

Eli Lilly

Healthcare

3/23

Hold

Cummins

Industrials

3/23

Withdraw

Newmont

Materials

3/23

Withdraw

Coca-cola

Consumer Discretionary

3/23

Withdraw

Traton SE

Industrials

3/23

Withdraw

Saint-Gobain

Industrials

3/23

Withdraw

VF Corp

Consumer Discretionary

3/23

Withdraw

Best Buy

Consumer Discretionary

3/23

Withdraw

Airbus SE

Industrials

3/23

Withdraw

Axel Springer SE

Communication Services

3/23

Withdraw

Unibail-Rodamco

Real Estate

3/23

Withdraw

Aptiv

Consumer Discretionary

3/23

Withdraw

Applied Materials

Information Technology

3/23

Withdraw

Twitter

Information Technology

3/23

Withdraw

Deere & Co

Industrials

3/23

Withdraw

Coca-cola

Consumer Staples

3/20

Uncertain

AT&T

Communication Services

3/20

Uncertain

BMW

Consumer Discretionary

3/20

Adjustments

Sysco

Consumer Staples

3/20

Withdraw

Maersk

Industrials

3/20

Withdraw

RPM

Materials

3/20

Withdraw

KDP

Consumer Staples

3/19

Adjustments

Burlington Stores

Consumer Discretionary

3/19

Withdraw

Ross Stores

Consumer Discretionary

3/19

Withdraw

Darden Restaurant

Consumer Discretionary

3/19

Withdraw

Exact Sciences

Healthcare

3/19

Withdraw

Cintas

Industrials

3/19

Withdraw

Target

Consumer Discretionary

3/19

Withdraw

Ford

Industrials

3/19

Withdraw

Estee Lauder Companies Inc

Consumer Discretionary

3/19

Withdraw

Sonic Healthcare

Healthcare

3/19

Withdraw

T-Mobile

Communication Services

3/18

Uncertain

EcoLab

Materials

3/18

Uncertain

General Mills Inc

Consumer Staples

3/18

Adjustments

Tapestry

Consumer Discretionary

3/18

Adjustments

Marriott

Consumer Discretionary

3/18

Withdraw

ConocoPhillips

Energy

3/18

Withdraw

Sketchers

Consumer Discretionary

3/18

Withdraw

GPT group

Real Estate

3/18

Withdraw

Baxter

Healthcare

3/17

Uncertain

Capri

Consumer Discretionary

3/17

Uncertain

Rea Group

Communication Services

3/17

Withdraw

Ramsay Healthcare

Healthcare

3/17

Withdraw

Ventas

Real Estate

3/17

Withdraw

Lam Research

Information Technology

3/17

Withdraw

Southwest Airlines

Industrials

3/16

Withdraw

Expedia

Consumer Discretionary

3/13

Withdraw

Gap

Consumer Discretionary

3/12

Uncertain

Ulta Beauty

Consumer Discretionary

3/12

Uncertain

Parker-Hannifin

Industrials

3/12

Hold

TransUnion

Industrials

3/12

Hold

CVS

Healthcare

3/12

Hold

Broadcom Inc

Information Technology

3/12

Withdraw

Huntington Bancshares

Financials

3/11

Uncertain

Mettler-Toledo International

Healthcare

3/11

Uncertain

Urban Outfitters

Consumer Discretionary

3/11

Uncertain

DuPont

Materials

3/11

Hold

Westen Union

Information Technology

3/11

Hold

Sherwin Williams

Materials

3/11

Hold

Cigna

Healthcare

3/11

Hold

Boston Scientific

Healthcare

3/11

Hold

Visa

Financials

3/11

Adjustments

Moody's

Financials

3/11

Adjustments

Hilton

Consumer Discretionary

3/11

Withdraw

Kroger Co

Consumer Staples

3/10

Uncertain

Reynolds Consumer Products

Consumer Staples

3/10

Uncertain

Westinghouse Air Brake Technologies

Industrials

3/10

Hold

The Cooper Companies Inc

Healthcare

3/10

Hold

Global Payments Inc

Financials

3/10

Hold

Anthem Inc

Healthcare

3/10

Hold

Laboratory Corp. Of America Holdings

Healthcare

3/10

Hold

Honeywell International Inc

Industrials

3/10

Hold

Royal Caribbean

Consumer Discretionary

3/10

Withdraw

American Airlines

Industrials

3/10

Withdraw

Delta Air Lines Inc

Industrials

3/10

Withdraw

Interpublic Group of Companies Inc

Communication Services

3/9

Hold

PerkinElmer

Healthcare

3/9

Adjustments

JetBlue

Industrials

3/9

Withdraw

Host Hotels

Consumer Discretionary

3/9

Withdraw

Bookings Holdings

Consumer Discretionary

3/9

Withdraw

Vail Resorts

Consumer Discretionary

3/9

Withdraw

Trivago

Consumer Discretionary

3/6

Uncertain

Burlington Stores

Consumer Discretionary

3/5

Uncertain

Equifax Inc

Industrials

3/5

Hold

Advanced Micro Devices Inc

Information Technology

3/5

Hold

PayPal

Financials

3/5

Hold

Marvell Technology

Information Technology

3/5

Adjustments

Dell

Information Technology

3/4

Uncertain

Align Technology Inc

Healthcare

3/4

Hold

Home Depot

Consumer Discretionary

3/4

Hold

Brown-FormaN

Consumer Staples

3/4

Adjustments

Ross Stores

Consumer Discretionary

3/3

Uncertain

Cummins

Industrials

3/3

Uncertain

Target

Consumer Discretionary

3/3

Hold

Agilent

Healthcare

3/3

Hold

United Rentals

Industrials

3/3

Hold

Thermo Fisher Scientific

Healthcare

3/3

Hold

Qorvo

Information Technology

3/3

Adjustments

Fidelity National Information Services

Information Technology

3/2

Hold

Analog Devices

Information Technology

3/2

Hold

Nutanix

Information Technology

3/2

Adjustments

Whirlpool

Consumer Discretionary

3/2

Adjustments

Microsoft

Information Technology

3/2

Adjustments

Hyatt

Consumer Discretionary

3/2

Withdraw

Microchip Technology

Information Technology

3/2

Withdraw

United Airlines

Industrials

2/24

Withdraw

Hormel

Consumer Staples

2/20

Hold

Apple

Information Technology

2/18

Adjustments

MGM

Consumer Discretionary

2/12

Withdraw

Yum Brands

Consumer Staples

2/6

Adjustments

 

Selected Commentary citing Uncertainty

Baxter International Inc - March 17th - Earnings Call

On the supply front, our manufacturing operations are currently running at planned levels and our supply chain team is assessing and mitigating possible disruptions around the globe. We are proactively managing our inventory levels, stock levels in warehouses transportation options and the availability of raw materials and component parts.

Given the global nature of the epidemic, we have seen some constraints on the limited number of components and APIs especially those sourced from China and Italy. At this time our team has been able to mitigate those disruptions by deploying existing inventory providing additional support to our suppliers to help them return to production, using alternate shipping methods to expedite delivery and working with additional suppliers we needed.

Our own efforts over the last few years to strengthen and expand our manufacturing supply network further support our position. We will continue to work closely with our regional and global supplier networks to address this ever-evolving situation. And our goal remains to help ensure all of our customers have access to the products they need to the best of our ability…  As stated in today's press release, given the high degree of uncertainty around potential impacts presented by COVID-19 we are not providing full year 2020 guidance at this time. Depending on how the situation unfolds, we hope to be in a position to provide additional guidance details during our first quarter earnings call currently scheduled for April 30…

 

Ulta Beauty Inc - March 12th - Earnings Call

As I describe in our priorities for 2020, I want to acknowledge that these plans were developed before the recent changes we've made to services and do not consider any prolonged disruption to demand resulting from coronavirus. As I said earlier, we're actively assessing various actions we may take to react to the corona environment, but the same still hold and are important to discuss…

Finally, I would note again that our guidance for 2020 does not include assumptions for any impact related to coronavirus. The situation is dynamic, and it's very difficult to predict or quantify the impact of any potential disruption to our supply chain, changes in consumer demand or any other actions that may become necessary as events unfold…

And I'd say if you break it apart from a supply chain perspective, we really haven't seen any material impacts to our supply chain. Our team's been working closely with our brand partners and our carrier partners really for weeks as necessary to pull forward some inventory of high-velocity SKUs. So right now, we feel pretty good about that, it's possible that could get disrupted, but we feel pretty good about that. On the demand side, we started to see some impact on store traffic this week, but it really varies by market. On the flip side, our e-commerce business has continued to perform strongly, and I say that should broadly relieve and including affected areas. So we're keeping a close eye on all of this. It's really too early to tell how it's going to play out, but so far that's our assessment of the situation.

 

Cummins - March 3rd - Evercore ISI Conference

So I think as you're aware, when we gave our guidance back at the beginning of February, we didn't include any impact of the coronavirus at the time. Things were still moving pretty rapidly, a pretty fluid situation.

What we've seen right now, we have about 10 facilities in the Hubei province in China, many more dotted throughout the rest of the country. In general, our facilities open 1 to 4 weeks after the Lunar New Year. So a delay on opening there. And our total China exposure on consolidated sales is about $40 million to $50 million a week. In addition to that, our JV income is about $200 million a year in China. So definitely had some negative impacts on domestic China consumption given the delays in start-up of our facilities. Almost all of the facilities now are up and running to some degree. Some of them 100%, some less than that. And I'd say the ones that are running a little less than that, it's really driven at this point by OEM partners whose facilities aren't up and running 100%.

So we'll know a little bit more about what the full year impact is, the demand, I think, by the time we get to Q1 earnings. Just need to see to what extent potentially the government does some stimulus and whether the demand that we did lose in the first quarter comes back in the second half of the year.

So from a finished Cummins product perspective, we do not export a significant amount of material outside of China. We generally produce and sell in country. The area that we're paying very close attention to is more some of our Tier 2 and Tier 3 suppliers that have some of their facilities out in China that export some of those to our global facilities.

So at this point, we've had no disruption, 20 of our facilities related to that. But certainly a very concerted effort by our supply chain organization tracking individual part numbers and understanding where the risks could be in the supply chain related to some of the delays of those Tier 2 or 3 suppliers that have been ramping up production.

 

Selected Commentary Citing Holding 

CVS Health Corp - March 12th - Barclays Virtual Global Healthcare Conference

So, just to give you some color, each of our business leaders are working to ensure business continuity plans are in order to meet the needs of our customers. In terms of that, as we think about pharmacy supply, we've experienced no disruption at this point. We're in close contact with all of our suppliers. And, what they've shared with us is, they tend to carry on average, three to six months of inventory. And, I would say, given our size and scale and the power of Red Oak and the diversity of our suppliers, we think we're in very good shape at this point. We also are able to have, I'll say, additional information around API sourcing and what have you to enable us to be proactive on that front.

As you look at what we've done to ensure consistency of care, everyone probably saw our announcement of offering zero co-pay telemedicine for visits for any medical reason, not just specific to COVID-19. With the goal of eliminating potential exposure in the physician offices or with others, we have waived our out-of-pocket costs for all diagnostic testing related to COVID-19 for all of our Aetna plan members.

And finally, as you look at the front store of our business, clearly, we've seen an increase in utilization in certain categories, particularly around cleaning supplies, masks, sanitizers, those types of categories. And, overall, from a supply perspective, our front store supply remained strong. We have had challenges. I'd say, we're essentially out of stock on masks. And, you could see, on sanitizers, sporadically, we're out of stock. But, we're continuing to receive supply…

So, let me take a step back from the quarterly guidance and just talk about the full year from a – for a second. Overall, with everything we know today, we're confident with our full-year adjusted EPS guidance range that we have provided of $7.04 to $7.17. Obviously, as I said a few minutes ago, right, coronavirus is fluid. There are some positives there. There are some challenges. But, with everything we know today, we're confident with that range.

 

Cigna Corporation - March 11th - Barclays Virtual Global Healthcare Conference

Now, in terms of financial impact which is where you went, at this point, we're not expecting a material financial impact to Cigna overall. As you know, we recently reaffirmed our 2020 earnings guidance and continue to be very excited about our growth across all four of our growth platforms.

In terms of your specific question, as you know, we have businesses both inside the US and outside the US. With our international business, we have both a global health benefits business and a local supplemental benefits business. With the latter, we offer a wide range of supplemental individual products. And as you know, we have quite a material business operations in Asia, in China, and Korea specifically. As it relates to China, what we've seen there is we've seen lower levels of elective discretionary utilization as people are really avoiding hospitals overall and healthcare facilities. But we're also seeing some dampening on the revenue side from new sales. But all in all, outside the US, we would not expect a material financial impact to the total enterprise based upon the dynamics.

I think your question and where you referred to some of the other companies was more what was happening within the US. Within our Integrated Medical, we would – very similarly to others, we would really expect to see the coronavirus unfold much like the flu. And as you know, over time, Cigna has never really pointed to the flu as a key driver to our earnings even in years where they're more severe than other years.

As you size it and we think about it, we think about the full-range impact. In terms of our MCR, medical cost ratio, or medical trend, for us, it's usually relatively muted. It's usually in the single- to low-double-digit-basis-point range. So, not a significant event. We continue to see the coronavirus in that context.

Now back to the second part of your question which is, obviously, if this would persist over time, from our viewpoint, we could obviously adjust that in a commercial pricing more quickly and then certainly for our governmental business, on the annual basis. But I would highlight, for Cigna, we've historically been less exposed to this – based upon the mix of our business and the nature of how our book of business has been positioned. So once again, I would stress, the flu, for us, high-single-digit, low-double-digit basis point as it relates to our MCR and our medical cost trend.

 

The Cooper Companies Inc - March 10th - Barclays Virtual Global Healthcare Conference

Sure, so we kept guidance intact. We basically tried to contain the coronavirus within Q2. I mean obviously, there's a lot of things changing in the world and the news is everything is kind of hot off the press. But, what we knew of last week and how put sort of booking s around it is we looked at our China business which was heavily impacted within our specialty lens business and within our IVF business. Both of those pieces of our business, both specialty and fertility, those visits and those procedures are done in hospitals. So, unlike in many other parts of the world, most parts of the world, where there are separate offices or clinics doing these types of fittings or procedures, in China, it's all done through hospitals. So, $10 million of the $15 million coronavirus-related impact that we segregated and sort of called out for Q2 is all related to China,. $6 million coming from Vision and $4 million from Surgical.

The rest of the coronavirus impact, we estimated at $5 million and that's representative of sort of the rest of the world, including places like Korea and Taiwan, and Hong Kong, Malaysia, Italy. So, the numbers fairly smallish. I mean, what we tried to do though is really kind of put our best guess and be able to justify the number. So, obviously, we did our channel checks. We went to all of our salespeople, our general managers, asked for updated forecasts, what they were seeing. And at the end of the day, the impact we're seeing in places outside of China has been relatively small. We're not seeing much of an impact. So, we aggregated all that up and that represents the $5 million Rest of World, so a total of $15 million.

Now, with respect to the guidance, we ended up keeping our guidance range the same. So, we're projecting Vision growth at 5.5% to 7% for the year; Surgical growth at 3% to 6%, which means Q2 to Q4 would have Vision growing 6% to 8% and Surgical growing 3% to 7%. Now this is driven from two different things. One is confidence in our ability to ramp up production in MyDay has been growing and continues to exceed our expectations. So we have a lot of lines coming in place this year, particularly in the back half of the year. And the timing around those lines moving into production and producing MyDay lenses for all of those lines have moved up anywhere from a couple of weeks to several weeks...

So we don't have anything in our guidance for any kind of claw back of coronavirus related lost sales. There is some optimism internally where we probably can claw back some of that. But for now the impact is lost revenue in Q2 offset by some additional revenue in Vision and Surgical in the second half of the year, particularly in Q4.

 

Honeywell International Inc - March 10th - J.P. Morgan Aviation, Transportation, and Industrials Conference

We did also talk about the planning assumptions that underpin the guidance, including among other things our expectation that there'd be minimal economic impact from China and the global economy from the coronavirus as well as, the assumption that the macroeconomic environment as we exited the fourth quarter, would remain pretty you know consistent throughout 2020. Those last two things, obviously are being challenged, real time and the corona situation and its implications are changing day-by-day as frankly evidenced even by, what's happening real time even now in places like Italy. Despite all that and based on our best possible forecast despite all that and based on our best possible forecasts as we see things today, we are reaffirming our original guidance for the first quarter. You know keep in mind our quarters tend to be back-end loaded in general with about 50% of our sales happening in the third month of every quarter. And with some of the challenges that have been going on this year that's probably even a bit more true than usual. That does make things a bit more difficult to call, which means among our guided metrics, organic sales growth will likely experience the most pressure when all is said and done, but we do know how to execute in environments like this, and we're going to continue to operate the company for the long-term for value creation, we do think this is a transitory impact at this stage…

At this stage, we're expecting the coronavirus to be short-term disruption as I mentioned, but that really does continue to evolve daily, in fact I just got out of our morning call probably 30 minutes ago with our team to understand what the effects of that are real-time.

 

Advanced Micro Devices Inc - Financial Analyst Day - March 5th

From a business standpoint, it is a very dynamic situation. So let me give you some color to kind of give you, a view of what's going on.

From an overall supply chain standpoint, our supply chain is primarily focused in China, Malaysia as well as Taiwan. And I would say, it's a very robust supply chain. So we have taken a number of actions to ensure that we have continuity in that supply chain. And based on what we see today, we're actually back to near-normal supply capacity in our supply chain.

So that is something that we continue to be very focused on. We're also monitoring our customers, since a lot of our customers have supply chains that are very dependent on China and some of those operations. And we did see some disruptions, certainly through Chinese New Year and in month of February. There's a lot of progress being made. I would say, all of us in the ecosystem are trying to return those operations to as normal as possible. And we expect that to continue over the next couple of weeks, I'm sorry, over the next coming weeks.

Now let me turn to the demand standpoint. I think from a demand standpoint, again, this is a very fluid situation. So there are lots of puts and takes. What we have seen is, outside of China, the overall demand has actually been about what we expected for the first quarter.

In China, we have seen some reduction in consumer demand, particularly in the off-line channel networks and those, I think, will continue for some time. We have also seen some other puts and takes, where the demand for infrastructure has increased beyond what we had expected originally. And so with all of that, we had guided the first quarter at our first quarter earnings call at $1.8 billion, plus or minus $50 million. We are not updating that as of now. Our best visibility is that the impact in the first quarter will be modest, but we'll keep watching that and perhaps we'll be in the lower half of the range, but still within the range of our original guidance. You also saw from Devinder that for the rest of 2020, we are standing -- our first quarter -- our 2020 guidance remains unchanged, and we see a very exciting growth path over the 2020 year.

 

PayPal Holdings Inc - March 5th - Evercore ISI Payments & FinTech Innovators Forum

Sure, sure. So I'll start with the fact that our core business has been performing very well. And I think that offset some of the impact when you look at what we shared in terms of the impact of COVID and how that relates to our first quarter guidance, still coming in within the range that we provided. But specific to Coronavirus, obviously, the topic of the day here. But things like this are, at best, difficult to forecast. And we've got a vast cross-border business that extends pretty prominently into Asia and China as well. And so the impact that we've seen has been really concentrated up to the point of our guidance in that region: China, Hong Kong, Southeast Asia. And specifically, what we were seeing is more on the Chinese seller side. So demand has held up pretty well, best we can tell. But certainly, I think there's been an impact more on fulfillment with Chinese sellers…

Yes. Well, so e-commerce trends are, I don't think necessarily are going to be substantively changed based upon an exogenous event like coronavirus. In fact, some hypothesize that if people are staying at home, you might even see e-commerce trends increase. And so the demand side has still been there. It's the supply side, it's what the -- the sellers and the ability to fulfill those orders that have had more of an impact on our numbers. But we've got a durable business. We've got a multifaceted portfolio of products. And we're in all the regions, major regions of the world. And so I think it's certainly reasonable to assume that if there is a prolonged and material impact from coronavirus, there's going to be some impact on growth. But we've got a very profitable business model that is showing strong incremental margins. And I don't think that, that's in question based upon what is hopefully maybe a more transitory event.

 

United Rentals - March 3rd - Evercore ISI Conference

The coronavirus question is interesting one, very interesting times here. We're fortunate enough to not have had that much exposure to it. We'll see what the coming weeks and days even bring, but we're not expecting a huge impact right now. I don't think our crystal ball is any clear than anybody else's on this. Personally, we're more focused on making sure our employees and then, therefore, our customers are operating in a mindful manner of what's going on around them. Supply chain seems to be what's been disrupted in most industries right now. We have not had this disruption. And I wasn't here for all of Terex's commentary, but our suppliers have not pushed out any lead times for us, the things that would be meaningful for our business. We haven't had any of those impacts. That's one of the areas where we think coronavirus is showing up early.

So we don't necessarily see a huge impact right now, and we don't expect a huge impact on our end markets. But you know we're going to stay tuned. The good news is we don't need to know. We have enough flexibility within our annual CapEx cadence and within the way that we can run our business that we don't have to the basis point predictability of the end market. We're just going to adjust accordingly. But right now, the end market sees that 2.7% growth that we have at the midpoint of our guidance holds for us.

 

Selected Commentary Citing adjustments, reporting wider range or expecting negative impact 

Suncor March 24th - IR Circulars 

The revised capital program is expected to be between $3.9 and $4.5 billion, a $1.5 billion or 26% decrease compared to the original 2020 capital guidance midpoint. The updated capital spend is concentrated on sustaining capital and continuing with a limited number of low capital intensity, value creating projects, as follows:

$2.3–2.7 billion related to asset sustainment and maintenance activities; $600–750 million on E&P step out developments; and Approximately $1 billion on high return / cost reduction projects largely independent of commodity price volatility. 

Suncor’s original capital guidance was $5.4 to $6.0 billion, with approximately 50% allocated to economic investment and 50% to sustaining capital. By the end of Q1 2020, Suncor is expected to have spent approximately $1.3 billion in capital. In order to sustain the financial strength of the business within the current economic environment, it is crucial to reduce the capital budget. Suncor is able to make these reductions because of the flexibility previously built into the budget. The targeted reductions include a combination of reducing economic investment and sustaining capital by deferring and cancelling projects, while maintaining a focus on safety and asset reliability over the long term.

IHS Markit March 24th - Earnings Call 

Jonathan Gear, IHS Markit Ltd. - CFO & Executive VP: That's great. Thank you, Lance. Now relative to our original guidance, as a reminder we previously announced the cancellation of events due to the COVID-19 health concerns. Again, as a reminder, these cancellations will negatively impact Q2 revenue by $50 million and adjusted EPS by $0.09. Approximately $40 million of the revenue impact relates to the Resources segment due to the cancellation of our CERAWeek and Chem Week events. The remaining $10 million relates to our Transportation segment, due to the cancellation of our [TPN] maritime and other events.

We have also adjusted for the change in foreign currency exchange rates since the beginning of the year, causing a negative FX impact on revenue of approximately $25 million.

In terms of our forward view for 2020, as Lance stated, due to the uncertainty, we have developed 3 scenarios to take into account different assumptions on how the virus, the price of oil and economic situation evolve over the next few months and quarters. Our supplemental schedules detail the 3 scenarios with the following ranges:

Revenue of $4.75 billion to $4.425 billion. Organic growth of between 1% and 4% normalized for the impact of the Q2 events. Adjusted EBITDA of $1.825 billion to $1.85 billion and adjusted EPS of $2.76 to $2.81. As Lance mentioned, we would direct your estimate to the lower end of these ranges at this time.

 

General Mills Inc - March 18th - Earnings Call

With that in mind, slide 5 summarizes how COVID-19 has impacted our business in recent weeks and what we expect to see in the coming months. As we mentioned last month at CAGNY, nearly half of our Häagen-Dazs shops in Greater China had been temporarily closed. In total, we saw a 90% decline in traffic in shops and substantial declines in other foodservice outlets in China in February, resulting in a significant reduction in Häagen-Dazs sales in Asia for the month. This was a 50-basis-point headwind to total company organic net sales growth and an estimated 150-basis-point headwind to adjusted operating profit and adjusted diluted earnings per share growth in the third quarter.

As the virus continues to spread, we expect to see reduced consumer demand for away-from-home food in the near-term, impacting both our Asia & Latin America and Convenience Stores & Foodservice segments. In Asia, while most of our shops are now open again, many have reduced hours and service, and store traffic is still down roughly 60% during the month of March.

At the same time, we expect to see greater near-term demand for food at home, primarily impacting our North America Retail and Europe & Australia segments. While it is still early, we've seen increased customer orders and higher retail sales takeaway in Nielsen-measured channels since the beginning of March.

Our US Retail sales results for the week ended March 7 were up low-double digits including Pet; and we anticipate takeaway for the week ending March 14 will be many times higher across all channels. While we assume this short-term stock-up demand will ebb in the coming months, our expectation is that overall at-home food demand will remain elevated in Q4 and the bulk of any unwind will happen in fiscal 2021. There is a great deal of uncertainty in this component of our forecast, and if we see a material change in outlook, we will provide an update before the end of the fiscal year.

Importantly, our supply chain is operating effectively around the world, and we've been able to service the vast majority of customer demand to-date. Our outlook assumes we continue to operate our supply chain with minimal disruption, but this could change if the virus situation worsens materially. Given this heightened level of uncertainty regarding COVID-19, our full-year guidance that Kofi will cover in a few minutes reflects a wider range for sales, profit, and EPS than we would typically carry with just one quarter remaining in the year.

 

Visa -  March 11th - Wolfe Research FinTech Forum

Question – Darrin David Peller: All right. So look, just -- I think the obvious place to start, just given the elephant in the room is the coronavirus and what you're seeing. Look, you guys preannounced recently, I think you talked about 2.5% to 3.5% impact on your fiscal second quarter growth rate. Based on what you had seen thus far, can you give us a little context into what went into those assumptions and maybe a little more of whatever you can tell us on what you're seeing, whether it's travel cross-border or U.S.?

Answer – Ryan M. McInerney: There's clearly a lot going on in the world right now. And as you noted, we did preannounce. I guess the first thing I'd say is our top priority is our people, Visa employees. This situation is evolving incredibly fast. Our leadership team is meeting several times a day, 7 days a week to track the latest developments and take whatever actions that we feel we need to take to ensure that our team members are safe and they're able to do the work that they need to do to support our clients and partners effectively. I do want to thank our Visa team members all around the world. They're just -- they're working incredibly hard, they're fantastic leaders, and they're navigating a tricky situation every day during the day. We're also in very close and regular contact with our clients, our partners, governments around the world. We're doing everything that we can do to help them navigate what are obviously complicated times for all of us.

You know, as it relates to our business and the spending trends, as you said, we released an 8-K last week on March 2. As you know and everybody has been tracking, since then, the virus has continued to spread to countries outside of Asia. As we expected, spending has continued to deteriorate, especially in travel. We factor this continuing deterioration during the month of March into the updated Q2 revenue projection that you referenced a moment ago and we included in our 8-K. And just given the recency of the spread and the impact that we're seeing on spending, it's honestly too early to tell what the overall impact is going to be.

As I think you would expect and you would hope in terms of expenses, we're doing a number of things inside our company. We're taking a series of actions to reduce expenses where we think it's smart and is not going to impact the health of our business, certainly in the medium to the long term. We continue to believe and I look forward to talking about a tremendous set of growth opportunities that we have for the company and we outlined on Investor Day.

So Darrin, listen, the situation is very fluid. There's no question we continue to monitor it very closely. Given the uncertainty surrounding the magnitude, the duration, the geographic reach of the impact, we're going to give an update of our views for future quarters and the full year for 2020 on our earnings call in April.

 

Marvell Technology - March 5th - Earnings Call

It is impossible for us to fully quantify the effect of the situation as our business -- on our business as it remains fluid. However, our revenue guidance for the first quarter includes a 5% reduction based on what we know so far. In addition, given the ongoing uncertainty, we have also temporarily widened our guidance range on revenue from plus or minus 3% to plus or minus 5%.

 

Microsoft - March 2nd - Morgan Stanley Conference

On the second half of your question, which is specifically on COVID-19, I think you really think about the adjustments we've made have been pretty narrow to the supply chain, as we have said for our guidance this quarter. Our focus primarily day-to-day is on the health and safety of employees, partners, customers and the communities in which we operate. And so that, for us, really is the first priority and then watching the pace of the supply chain recovery. We'll continue to do what others are doing and continue to keep an eye on it.

 

Selected Commentary Citing Withdrawal 

Mastercard - March 24th - 8K 

The long-term fundamentals of our business remain strong. However, due to the speed with which the COVID-19 situation is developing and the unknown duration and severity of the event, we are suspending our annual 2020 outlook for both net revenue and operating expense growth at this time. We anticipate giving further updates on our first-quarter earnings call.

 

Unibail-Rodamco-Westfield - March 23rd - PR 

On February 12, 2020, Unibail-Rodamco-Westfield (“URW” or “the Group”) announced its 2019 results and proposed a dividend of €10.80 per stapled share. There were only a limited number of COVID-19 cases outside China at that time. Since then, the COVID-19 pandemic has evolved significantly and at a very rapid pace.

Governments and business are employing stringent measures to slow the spread of the COVID-19 virus, as described in the press releases issued by the Group on March 16 and 19. There is currently a lack of clarity about whether further measures will be deployed and significant uncertainty about the duration and impact of the COVID-19 pandemic on the operations of the Group.  

Consequently, URW announces that:

  • It withdraws its 2020 AREPS guidance and expects to provide an update on its guidance when it can reliably estimate the duration, severity, and consequences of the current situation;

 

Coca-Cola - March 23rd - PR 

To protect our business and manage cash at this time, we are actively working through all measures we can take. As the situation is unprecedented and rapidly evolving, it is not possible today to accurately predict the impact on our business. We have, however, started to see an increasing impact on the AFH channel with some volume moving to the Home channel. We are modelling, incorporating learnings from other Coca-Cola bottlers, the effects of differing revenue and volume impacts in these channels, but it is too early to draw conclusions.

We are also reviewing our variable operating expenditure, including reducing discretionary spend in areas such as marketing, promotions, seasonal labour and merchandising, and delaying discretionary capital expenditure. Measures will continue to adapt as the situation evolves.

Whilst we remain confident that the post pandemic future of the business remains strong, the significant uncertainty in relation to the duration and impact of the situation on our markets, leads us to believe it is appropriate to withdraw our guidance for the current financial year. In addition, to keep CCEP well positioned and preserve maximum flexibility during this challenging period, we will suspend our share buyback programme until further notice.

TJX Companies Inc  - March 19th - 8K 

Effective today the Company is closing all of its stores in the United States, Canada, Europe, and Australia for two weeks. In certain regions, including Germany, Poland, Austria, Ireland, and the Netherlands, and a number of U.S. and Canadian locations, the Company had previously closed stores based on several factors, including government or health department requirements. The Company is also closing its online businesses tjmaxx.com, marshalls.com, and sierra.com. Further, the Company is temporarily closing its distribution centers and offices, with Associates working remotely when they can. We know our Associates are very concerned for their health and financial well-being, and we plan to pay our store, distribution center and office Associates for two weeks during these closures.

To further strengthen its financial position and balance sheet, and maintain financial liquidity and flexibility, the Company is taking the following actions:

  • Drawing down $1 billion from its revolving credit facilities.
  • Suspending its share repurchase program.
  • Evaluating its dividend program.
  • Reviewing all operating expenses.
  • Reducing capital expenditures.

The Company also announced today that it is withdrawing its first quarter and full year Fiscal 2021 financial guidance given on its February 26, 2020 earnings conference call. The Company is not providing an updated outlook at this time

 

Delta Air Lines Inc - March 10th - J.P. Morgan Aviation, Transportation and Industrials Conference 

As the situation has evolved, our first priority has been protecting the health and the safety of our customers and our employees. Our team has significantly increased resources to insuring our aircraft and facilities are clean and exceed our already high safety standards. While our year had gotten off to a strong start, in fact being ahead of plan for the first two months. Two weeks ago, our revenue trajectory changed dramatically as the virus spread meaningfully outside of Asia. Since then, we have seen a 25% to 30% decline in net bookings and are prepared for it to get worse. We expect demand erosion will continue in the near term and a built-up plan that prioritizes free cash flow generation and preserves liquidity.

Besides the safety of our employees and customers, our overarching goal during this time is cash preservation. We are targeting a minimum $5 billion in liquidity, being free cash flow positive and maintaining our investment grade balance sheet. And we're taking a number of actions to address the financial impact.

First, the biggest lever that we have is capacity. We are actioning system capacity reductions of at least 15% down versus our plan. We are taking international down 20% to 25% and domestic down 10% to 15%. Importantly, we're prepared to do more as the situation evolves. Second, we're implementing cost reduction initiatives and are taking out $1.8 billion of expense versus our plan. This includes capacity related expenses as well as incremental cost initiatives that include a hiring freeze, offering voluntary leave options and lowering maintenance expense by temporarily grounding aircraft.

We have also had the benefit of approximately $2 billion of lower fuel expenses. Jet fuel prices have dropped significantly since the start of this year. Finally, we've also undertaken $3 billion of cash flow and liquidity-enhancing initiatives including CapEx deferrals, delaying voluntary pension contributions and suspending share repurchases. By taking these actions now, we can mitigate the impact going forward.

Unfortunately, there's little we can do to impact the March quarter which we currently expect will see a mid to high-single digit decline in unit revenues for the quarter. We are also withdrawing our full-year guidance until we have more clarity on the duration and severity of the current situation...

 

United Airlines - February 24th - 8K

For the first quarter of 2020, we currently expect the reduced revenue on our trans-Pacific routes to be partially offset by the related decline in fuel prices and other cost savings. The incremental earnings headwind is also expected to be offset by higher earnings from our recently extended co-brand partnership with JPMorgan Chase Bank, N.A. and Visa U.S.A. Inc. Accordingly, we expect first quarter adjusted diluted earnings per share ("EPS") to remain within our previously provided guidance range of $0.75 to $1.25. 1 Beyond the first quarter, we believe the range of possible scenarios is too wide to provide earnings guidance at this time. If COVID-19 were to run its course by mid-May, and normal travel patterns on trans-Pacific routes resume gradually over five months, we would expect to be tracking to deliver 2020 adjusted EPS within our previously provided guidance range of $11.00 to $13.00. 1 However, due to the heightened uncertainty surrounding this outbreak, its duration, its impact on overall demand for air travel and the possibility the outbreak spreads to other regions, the Company is withdrawing all full-year 2020 guidance issued on January 21, 2020.



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