DGAP-News: Steinhoff International Holdings N.V. / Key word(s):
Miscellaneous
Steinhoff International Holdings N.V.: COVID-19 UPDATE
2020-03-20 / 14:35
The issuer is solely responsible for the content of this announcement.
*COVID-19 UPDATE*
Steinhoff International Holdings N.V. ("*Steinhoff*" or the "*Company*" and
with its subsidiaries, the "*Group*").
Steinhoff continues to monitor ongoing developments related to the global
Coronavirus (COVID-19) outbreak and provides the following update.
*Colleagues & Customers*
The safety of our colleagues and customers is our top priority and we are
fully supporting the global and regional initiatives to bring the pandemic
under control.
We have implemented a programme of measures to protect the health and safety
of our employees, including restricting travel and face-to-face meetings,
asking colleagues to work from home where possible, and adopting all
specific public health protocols. Business continuity plans are in place to
ensure customer service levels are maintained in store and in central
support facilities.
As the Coronavirus outbreak has progressed, the most significant impacts on
the Group have switched from those with a supply chain focus to those with a
demand-side impact.
*Supply-side impacts*
At the beginning of the outbreak in February, attention was focused on
efforts to mitigate disruption in the supply chain. Many of the businesses
in the Group source products from various countries in Asia and some factory
supply was negatively impacted by the outbreak and spread of the
Coronavirus. The Group's supply chain is well-diversified and flexible,
allowing it to respond rapidly to anticipated inventory shortages and other
sourcing challenges. The Group benefitted from this agility and was able to
address and mitigat these issues, wherever possible, through alternative
sourcing and other arrangements. More recently, the affected factories have
reopened and are rebuilding capacity.
Shipments of goods from Asian ports were also restricted once production was
re-established but proactive management of stock in the supply chain,
including swift utilisation of capacity freed up by order cancellations
elsewhere, helped reduce the impact. The situation has continued to improve
as port operation returns to normal. Overall, while we are still
experiencing some delays in sourcing product, these are now reducing and we
continue to offset the impact through mitigation strategies.
*Demand-side impacts*
Over more recent weeks many of the countries in which we do business have
implemented broad-based steps to contain the spread of the virus, resulting
in significant restrictions on movement and public gatherings, and the
closure of commercial facilities. These measures have resulted in the
partial or full closure of a number of our general merchandise stores, or
restrictions on trading hours, in a number of European markets including
France, Spain, Poland and the Czech Republic.
As a result turnover has reduced, particularly in general merchandise, and
this will continue for the duration of these restrictions. The performance
of our FMCG focused businesses has been more resilient, partially offsetting
this impact.
*Conclusion*
The extent and duration of the current restrictions on trade remain
uncertain and it is too early to determine the exact impact of the pandemic
on the performance of the Group for the 2020 financial year. It is clear,
however, that the virus outbreak and resulting restrictions will have a
negative impact on overall turnover and the underlying business performance
during this period.
Operating companies are implementing plans to strengthen their cashflows
through both proactive management of their forward purchase order
commitments and, where appropriate, by the use of flexible working
contracts. The inherent strength and flexibility of the Group's sourcing
arrangements is also providing important additional support.
Management are continuing to take an active approach, implementing a range
of mitigating strategies to protect profitability and cashflow. Immediate
and significant actions are being implemented to reduce costs and optimise
liquidity. These include reducing operating expenditures, reducing stock of
goods impacted by the trading restrictions, actions to optimise working
capital, stopping all but essential capital expenditure, and making use of
tax payment and other government relief measures where available.
While the Group is confident that the actions it is taking to address the
impacts of the Coronavirus are appropriate and timely, the situation remains
fast moving and uncertain and these are being kept under constant review.
Further updates will be given as appropriate.
20 March 2020
2020-03-20 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Archive at www.dgap.de
Language: English
Company: Steinhoff International Holdings N.V.
cnr Adam Tas and Devon Valley Road
7600 Stellenbosch
South Africa
Phone: +27218080700
Fax: +27218080800
E-mail: investors@steinhoffinternational.com
Internet: www.steinhoffinternational.com
ISIN: NL0011375019
WKN: A14XB9
Indices: SDAX
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated
Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,
Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1002949
End of News DGAP News Service
1002949 2020-03-20
(END) Dow Jones Newswires
March 20, 2020 09:35 ET (13:35 GMT)
