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Wellington Drive Technologies update on the impacts of CoronavirusAUCKLAND, New Zealand, Feb. 12, 2020 /PRNewswire/ -- Wellington Drive Technologies (Wellington) is closely monitoring the impact of the 2019 Novel Coronavirus (nCov) on its supply chain operations. Wellington supplies motors and IoT hardware to customers that are manufactured by its supply partners East West Vietnam and Match-Well China. The company's supply chain is global in nature and components that suppliers need for production are sourced globally, and from across Asia, including China, which is the predominant or sole source of certain componentry. As a result of the nCoV emergency and measures put in place in China by local and central government, Wellington is expecting an impact on product supply. This is due to government restrictions on factory openings, restrictions in movement of people and port and logistics facility closures. Some known impacts are as follows: -- Wellington's East West Vietnam factory is open; however, production will be impacted by China-sourced component supply shortages. Wellington is in the process of switching more production to East West's Vietnamese factory until products can resume shipment into and out of China. In addition, the company is working with alternate sources for some components to mitigate some of the supply risk. The company has implemented travel restrictions to and within mainland China and is reducing international travel generally in order to protect employees. It is following travel and health guidance provided by international governments and authorities. 2020 forecast These initial forecasts indicate a potential risk to revenue of approximately US$3.6m (around NZ$6m) from February to April. The company does not expect that all of this delayed supply will be perishable, so some catch up later in Q2 currently appears likely. Forecasting the full loss of this revenue would take 2020 forecast sales to around NZD$65m, which would be below our existing guidance for revenue growth of around 15% over 2019. The company will continue to update its forecast scenarios as further information about nCoV becomes available. If necessary, Wellington can defer planned incremental expansion spending, which would somewhat mitigate the flow through impact on the forecast 2020 profit. 2019 results update About Wellington Drive Technologies: Wellington is a leading provider of IoT solutions, cloud-based fleet management platforms, energy-efficient electronic motors and connected refrigeration control solutions. It serves some of the world's leading food and beverage brands and refrigerator manufacturers and offers proximity-based marketing for Smart Cities to the Australian market. Wellington's services and products improve sales, decrease costs and reduce energy consumption. Headquartered in Auckland with a global reach, Wellington is listed on the New Zealand stock exchange under the ticker symbol NZ:WDT For further information visit www.wdtl.com View original content:http://www.prnewswire.com/news-releases/wellington-drive-technologies-update-on-the-impacts-of-coronavirus-301004171.html SOURCE Wellington Drive Technologies |