AYALA-LED Integrated Micro-Electronics, Inc. (IMI) has suspended operations at its facilities in China due to the novel coronavirus outbreak hounding the country.
In a statement yesterday, the listed electronics firm said it has delayed the resumption of work in four manufacturing facilities located in the provinces of Guangdong, Zhejiang, Sichuan and Jiangsu following orders of the Chinese government.
“Along with the customers, IMI is developing contingency plans to recover production backlogs as a result of these suspensions including among others, the temporary transfer of production activities for some customers to other IMI manufacturing plants,” it said.
“IMI is currently assessing the extent of the impact of such outbreak on its operational and financial performance,” it added.
In the first nine months of 2019, IMI’s operations in China generated $400 million of its total $939.6 million revenues, the company said in an e-mail Thursday. IMI’s total sales during the period were 7% lower year-on-year due to China’s domestic market challenges.
IMI operates five production plants in China, according to records on its website: IMI Technology (Shenzhen) Co. Ltd.; Speedy-Tech Electronics (Jiaxing) Co. Ltd.; IMI (Chengdu) Ltd.; VIA Optronics (Suzhou) Co. Ltd.; and IMI Building A2-4_Kuichong. These facilities employ more than 5,900 people combined.
The plants affected by the operational shutdown are those in Shenzhen, Jiaxing, Chengdu and Suzhou. IMI expects that the earliest these could resume operations would be in February, specifically, Feb. 3 for the Chengdu plant, Feb. 9 for the Suzhou plant and Feb. 10 for the Shenzhen and Jiaxing plants.
“Management is communicating with local government offices regarding the possibility of resuming production earlier than the mandated dates at reduced production capacity,” it said.
“The company is implementing guidelines to address and manage employees who manifest symptoms associated with the coronavirus. Business trips to and from high risk regions have been deferred,” it added.
The novel coronavirus, which has resulted to a lockdown of Wuhan in China and suspension of several business operations, has killed 170 and infected 7,711 people in China as of Thursday, Reuters said in a report. The virus has spread across the globe already, with 104 confirmed cases outside mainland China.
Shares in IMI at the Philippine Stock Exchange lost 41 centavos or 5.32% to P7.29 each on Thursday. — Denise A. Valdez