March 11, 2020 / 6:32 AM / in a month

Knorr Bremse takes coronavirus hit in Feb, China now ramping up

BERLIN, March 11 (Reuters) - Knorr Bremse, a maker of braking systems for rail and commercial vehicles, said on Wednesday it would take a 60 million euro ($68 million) revenue hit in February due to the coronavirus epidemic in China.

“As of now, we remain confident to manage the delivery of our products without major disruptions,” the German company said as it reported 2019 results.

“More than 80% of our Chinese workforce has been allowed to return to our plants by now and production is ramping up fast to planned capacities.”

It was too early to quantify the full-year impact of coronavirus but the epidemic is likely to negatively impact financial performance in the first half of 2020, the company said.

Compensating for that in the second half of the year will depend on how far the virus spreads outside of China, it added.

Assuming economic and political stability, Knorr expects to generate revenue of 6.5-6.8 billion euros in 2020 and an operating margin in the range of 18-19%.

“In case the global economy was to deteriorate beyond today’s expectation, we are prepared to act fast with appropriate cost programs,” it said.

Revenue last year grew by 4.8% to 6.9 billion euros and the company expanded its margins to 19.2% from 17.8% the year before.

Its shares closed on Tuesday at 77.32 euros, below the 80 euros at which the company floated in Oct. 2018. ($1 = 0.8814 euros)

Reporting by Douglas Busvine; editing by Thomas Seythal

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