World News

Mondelez warns of hit from coronavirus; reopens China plants

(Reuters) – Mondelez International Inc <MDLZ.O> on Tuesday forecast a hit to its first-quarter revenue and margins from the coronavirus outbreak and said four of its manufacturing plants in China had resumed operations.

The Oreo maker, however, said the plants were not operating at full capacity and that it had been facing a shortage of trucks in China, one its two key markets alongside the United States, resulting in additional transportation costs.

The epidemic, which has claimed nearly 1,900 lives, has forced companies with significant exposure to China to temporarily shut stores. Some have also warned of a hit to their earnings.

“The coronavirus happened at the high peak of consumption, which is Chinese New Year, which is very important for us and many players there,” Chief Financial Officer Luca Zaramella said at the CAGNY Conference.

The company did not quantify the financial hit from the outbreak.

China, the world’s second largest economy, accounts for nearly 4.5% of Mondelez sales.

Shares of the Deerfield, Illinois-based company reversed course to trade marginally up after trading in the red for the better part of the session.

Earlier today, General Mills told nearly half of its Haagen-Dazs ice-cream shops in Greater China had been temporarily closed.

(Reporting by Praveen Paramasivam in Bengaluru; Editing by Shailesh Kuber)