Toronto, Ontario – Martinrea International Inc., a diversified and global automotive supplier engaged in the design, development and manufacturing of highly engineered, value-added Lightweight Structures and Propulsion Systems, today announced that as a result of actions taken on behalf of the Company’s automotive OEM customers in both North America and Europe in response to the coronavirus (COVID-19) outbreak, including temporary plant closures, as well as uncertainty regarding the duration and business impact of the virus, it is withdrawing its previously-disclosed financial guidance and medium-term outlook.
“These announced customer plant shutdowns will affect the Company’s own production levels during the remainder of Q1 2020 and likely beyond, as restarting of production could be delayed, and partial or full shutdowns may continue. Additionally, if the virus persists or government actions in response to COVID-19 continue, demand may be impacted as consumers adjust buying patterns,” said Fred Di Tosto, Chief Financial Officer. “Given the elevated level of uncertainty, the Company is withdrawing its financial guidance for the first quarter of 2020 (Q1 2020) as well as its 2021 outlook.”
“At Martinrea, employee safety is paramount and central to the Company’s vision, mission and culture. We have taken many measures to protect our employees during the COVID-19 outbreak, including social distancing, work from home where possible, and enhanced safety procedures,” said Rob Wildeboer, Executive Chairman. “To date, we have not experienced any cases of COVID-19, though we are prepared to act in the unfortunate event that they arise. While our plants have remained open up to these recent announcements by our automotive OEM customers, their continued operation and level of production will be dictated by the actions and activity levels at the operations of our customers.”
“Our business remains strong and we are well positioned to address the major challenges our Company and our industry are currently facing. Our contingency planning gives us confidence we will work our way through this difficult time, potentially capitalizing on opportunities as and if they arise,” said Pat D’Eramo, President and Chief Executive Officer. “As always, but particularly in this time of uncertainty, balance sheet preservation is a top priority, and, as such, we have temporarily suspended our share buyback program in order to conserve cash. We are also in discussion with our lenders regarding additional flexibility for our credit facilities, if needed. We are proactively taking these measures in order to prudently manage downside risk, not because there is an explicit need for additional financing.”
“While these are certainly trying times, we have managed through downturns and negative industry and macroeconomic developments in the past and we have emerged stronger as a result. We expect the COVID-19 situation and the current economic challenges to be no different. Our industry is healthier today than it was heading into the last downturn, and Martinrea is in a position of relative strength within our industry. While the COVID-19 situation remains fluid, we intend to provide a further update when we report our Q1 2020 results in May,” concluded Mr. D’Eramo.
About Martinrea International Inc.
Martinrea International Inc. (TSX: MRE) is a leader in the development and production of quality metal parts, assemblies and modules, fluid management systems, and complex aluminum products focused primarily on the automotive sector. Martinrea currently employs approximately 17,000 talented and motivated people in 57 locations in Canada, the United States, Mexico, Brazil, Germany, Slovakia, Spain, China, South Africa and Japan. Martinrea’s vision is making lives better by being the best supplier we can be in the products we make and the services we provide. For more information on Martinrea, please visit www.martinrea.com. Follow Martinrea on Twitter and Facebook.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of applicable Canadian securities laws including statements related to anticipated plant closures, anticipated duration of plant closures, likely impact of shutdowns on the Company and production levels, possible delay of production restarts, possibility of continued partial or full shutdowns, potential impact on demand, potential for consumers to adjust buying patterns, or continued governmental intervention, ability to respond to any cases of COVID-19, ability of the Company’s plants to continue operation and production levels, the Company’s ability to work through difficult times, and capitalize on opportunities; statements relating to the Company’s financing needs; the Company’s statements on COVID-19 and economic challenges, as well as other forward-looking statements. The words “continue”, “expect”, “anticipate”, “estimate”, “may”, “will”, “should”, “views”, “intend”, “believe”, “plan”, “outlook” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on estimates and assumptions made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate in the circumstances, such as expected sales and industry production estimates, current foreign exchange rates (FX), timing of product launches and operational improvements during the period and current Board approved budgets. Many factors could cause the Company’s actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the industry trends and risk factors outlined in the Company’s Annual Information Form (including about epidemics and pandemics such as the coronavirus) and other public filings which can be found at www.sedar.com.
These factors should be considered carefully, and readers should not place undue reliance on the Company’s forward-looking statements. The Company has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
The common shares of Martinrea trade on The Toronto Stock Exchange under the symbol “MRE.”
For further information, please contact:
Fred Di Tosto, Chief Financial Officer
Martinrea International Inc.
Deanna Lorincz, Global Director, Communications and Marketing
Martinrea International Inc.