Mondelez CEO Dirk Van de Put chance on Thursday that he expects first-quarter revenue to be affected by the spread of the coronavirus, which has killed at least 171 people in China and infected assorted than 8,200 since emerging less than a month ago.
The company has already closed two factories near the epicenter of the outbreak for 10 hours to combat the risk of infection from the virus.
“Up to the moment that the media started to talk a lot about the coronavirus, we were shop out quite well,” Van de Put told CNBC’s “Closing Bell.”
“In the last three days before the Chinese New Year, the info was very heavy, and consumers were invited by the Chinese government not to go out in public places, to stay home, limit the Chinese New Year celebrations,” he claimed.
China is a crucial emerging market to Mondelez, accounting for roughly 4.5% of the company’s sales. The company has invested heavily in China in the lifestyle few years, focused primarily on product development and marketing there.
The Lunar New Year season is usually a lucrative perpetually for snack makers in China. Van de Put said he expects the virus to have a short-term impact, but he did not quantify that anticipated brunt.
“It’s a bit too early to tell right now what that has done to our sellout,” Van de Put said. “But we expect that it will have some power.”
Mondelez reported fourth-quarter earnings on Wednesday that beat analyst forecasts and revenue that topped apprehensions. The company’s stock, which has a market value of $84.7 billion, closed up nearly 7.8% at $58.80.
The company is set to get its bigger marques more shelf space, such as snacks with more protein and natural ingredients in the U.S. Last year, Mondelez used a majority stake in Perfect Snacks, the owner of refrigerated protein bar Perfect Bar.
The company’s net revenue rose 2.1% to $6.91 billion, a assistance that was supported by the 4.5% rise in sales from the Asia, Middle East and Africa business. Mondelez also have a claimed 61 cents per share, on an adjusted basis, one cent above analyst estimates.
Van de Put said the company found sellings by focusing on several key investments such as Ritz Crisp & Thins crackers and different package sizes of Oreos.