Revenue of $11.87B (+7.9% Y/Y) misses by $60M.
Shares +0.75% PM.
https://seekingalpha.com/news/3538427-merck-eps-beats-0_01-misses-on-revenueWednesday, February 5, 2020
Beam Therapeutics upsizes IPO
Beam Therapeutics (BEAM) has filed an updated prospectus for its IPO of 9.25M common shares (from 6.25M) at $15 – 17 per share.
https://seekingalpha.com/news/3538418-beam-therapeutics-upsizes-ipo
https://seekingalpha.com/news/3538418-beam-therapeutics-upsizes-ipo
Foxconn sees full China production resuming late-February
Taiwan’s Foxconn, which makes smartphones for global vendors including Apple (AAPL.O),
has filed requests to reopen factories with Chinese authorities, the
source said, adding that a full resumption was not possible until late
February due to various travel restrictions imposed to curb the virus.
A delay in the resumption of operations could have an impact on the global technology supply chain and shipments to Foxconn’s customers, including Apple.
“Roads are closed in some parts of the country. Nobody knows for sure if some workers could get back in time,” said the source, who described a “chaotic” situation in the company’s top management as it scrambles to meet different requirements for the resumption of operations set by various local governments across China.
“A full resumption will take at least one to two weeks from Feb. 10.”
In some cities, authorities are asking companies to put workers returning from other provinces under a three-day quarantine, which was a challenge for big companies like Foxconn, the source said.
“How is it possible to quarantine tens of thousands of people in one neighborhood for three days?” the person said.
The factory halt is set to hit Foxconn’s profit for 2020 but it was still evaluating the likely impact, the person said.
“Profit is definitely going to be hit, but as to how big the impact will be, we’re still calculating,” the person said.
Foxconn did not immediately respond to a request for comment.
The outbreak of the coronavirus, which the World Health Organization has declared a global health emergency, threatens to disrupt swathes of Chinese manufacturing and will force policymakers to ready measures to stabilize the economy.
Companies in China, closed for the Lunar New Year holiday, were told to stay shut for an extra week, until as late as Feb. 10, including those in the southern manufacturing hub of Dongguan in export-oriented Guangdong province, where some iPhone plants are located.
Foxconn, the world’s largest contract electronics manufacturer, was making plans to ensure the health and safety of its hundreds of thousands of workers, including scanning a QR code on employees’ mobile phones for health screening.
The company will use local workers as much as possible while allowing time off for those who can not travel long distances to get back to work, according to an internal document reviewed by Reuters.
Foxconn’s factories are dependent to a great extent on migrant workers from poorer regions.
“We will be very glad if the return rate could hit 30% (on Feb. 10),” the source said.
Shares of Foxconn, formally known as Hon Hai, have dropped more than 10% since the market .TWII reopened last week following the Lunar New Year holiday.
https://www.reuters.com/article/us-china-health-foxconn/foxconn-sees-full-china-production-resuming-late-february-source-idUSKBN1ZZ10B
A delay in the resumption of operations could have an impact on the global technology supply chain and shipments to Foxconn’s customers, including Apple.
“Roads are closed in some parts of the country. Nobody knows for sure if some workers could get back in time,” said the source, who described a “chaotic” situation in the company’s top management as it scrambles to meet different requirements for the resumption of operations set by various local governments across China.
“A full resumption will take at least one to two weeks from Feb. 10.”
In some cities, authorities are asking companies to put workers returning from other provinces under a three-day quarantine, which was a challenge for big companies like Foxconn, the source said.
“How is it possible to quarantine tens of thousands of people in one neighborhood for three days?” the person said.
“Profit is definitely going to be hit, but as to how big the impact will be, we’re still calculating,” the person said.
Foxconn did not immediately respond to a request for comment.
The outbreak of the coronavirus, which the World Health Organization has declared a global health emergency, threatens to disrupt swathes of Chinese manufacturing and will force policymakers to ready measures to stabilize the economy.
Companies in China, closed for the Lunar New Year holiday, were told to stay shut for an extra week, until as late as Feb. 10, including those in the southern manufacturing hub of Dongguan in export-oriented Guangdong province, where some iPhone plants are located.
Foxconn, the world’s largest contract electronics manufacturer, was making plans to ensure the health and safety of its hundreds of thousands of workers, including scanning a QR code on employees’ mobile phones for health screening.
The company will use local workers as much as possible while allowing time off for those who can not travel long distances to get back to work, according to an internal document reviewed by Reuters.
“We will be very glad if the return rate could hit 30% (on Feb. 10),” the source said.
Shares of Foxconn, formally known as Hon Hai, have dropped more than 10% since the market .TWII reopened last week following the Lunar New Year holiday.
https://www.reuters.com/article/us-china-health-foxconn/foxconn-sees-full-china-production-resuming-late-february-source-idUSKBN1ZZ10B
Airbus halts output at Tianjin assembly plant due to coronavirus
Airbus (AIR.PA)
has closed its final assembly plant in Tianjin, China, as a result of
the coronavirus emergency, the planemaker said on Wednesday, adding it
was monitoring for any signs of impact on deliveries.
The plant assembles about 4 A320-family aircraft a month, about 7% of Airbus narrowbody production.
“The Tianjin Final Assembly Line facility is currently closed,” Airbus said in a statement.
“Airbus is constantly evaluating the situation and monitoring any potential knock-on effects to production and deliveries and will try to mitigate via alternative plans where necessary.”
The death toll from an outbreak of the coronavirus has risen to nearly 500.
https://www.reuters.com/article/us-china-health-airbus/airbus-halts-output-at-tianjin-assembly-plant-due-to-coronavirus-idUSKBN1ZZ1ER
The plant assembles about 4 A320-family aircraft a month, about 7% of Airbus narrowbody production.
“The Tianjin Final Assembly Line facility is currently closed,” Airbus said in a statement.
“Airbus is constantly evaluating the situation and monitoring any potential knock-on effects to production and deliveries and will try to mitigate via alternative plans where necessary.”
The death toll from an outbreak of the coronavirus has risen to nearly 500.
https://www.reuters.com/article/us-china-health-airbus/airbus-halts-output-at-tianjin-assembly-plant-due-to-coronavirus-idUSKBN1ZZ1ER
Novo Nordisk Sales Beat on Diabetes Treatments — Earnings Review
Novo Nordisk A/S (NVO) reported results for the fourth quarter on Wednesday. Here’s what we watched:
SALES: Sales rose 9% to 32.42 billion Danish kroner ($4.79 billion) against analysts’ expectations of DKK31.95 billion. Sales in the quarter found support from Novo Nordisk’s diabetes treatments, as well as increased sales in obesity care and biopharm, offset by declining insulin sales.
NET PROFIT: Net profit for the three months ended Dec. 31 rose to DKK8.72 billion from DKK8.5 billion a year earlier, missing the DKK9.2 billion forecast by analysts in a FactSet poll.
WHAT WE WATCHED:
GLUCAGON-LIKE PEPTIDE-1: Sales of Novo Nordisk’s Ozempic glucagon-like peptide-1 products for type 2 diabetes–Victoza, Ozempic and Rybelsus–increased by 27% measured in Danish kroner and by 22% in local currencies to DKK33.2 billion in 2019. Sales growth was driven by both its North America and international operations, it said. Sales of Ozempic totaled DKK11.2 billion and Ozempic has now been launched in 26 countries. The GLP-1 segment’s value share of the total diabetes market has increased to 18.0% compared with 14.4% 12 months ago and Novo Nordisk said it has a 47.5% market share in the global GLP-1 segment.
MARGINS: The gross margin was 83.2% in the fourth quarter of 2019 compared with 84.4% in the same period last year. The decline of 1.2 percentage points of the gross margin reflects a negative impact from lower realised prices in the U.S. and a negative currency impact of 0.3 percentage point partly countered by a positive product mix. The EBIT margin rose slightly to 36.6% from 36.3%.
GUIDANCE: For 2020, sales growth is expected to be 3%-6% measured in local currencies, reflecting expectations for robust sales of the company’s diabetes-care products Ozempic, Victoza and Rybelsus, obesity-care product Saxenda, the portfolio of new-generation insulin and biopharm products Esperoct, Refixia and NovoEight. The guidance also reflects intensifying competition both within diabetes care and biopharm, as well as continued pricing pressure within diabetes care and affordability initiatives in the U.S., it said. Sales growth reported in Danish kroner is expected to be one percentage point higher than in local currencies. Operating-profit growth is expected to be 1% to 5% measured in local currencies. Reported in Danish kroner it is expected to be one percentage point higher than in local currencies. Capital expenditure is expected to be around DKK6.5 billion in 2020, primarily relating to investments in additional capacity for production within diabetes care.
https://www.marketscreener.com/NOVO-NORDISK-AS-1412980/news/Novo-Nordisk-Sales-Beat-on-Diabetes-Treatments-Earnings-Review-29943740/
SALES: Sales rose 9% to 32.42 billion Danish kroner ($4.79 billion) against analysts’ expectations of DKK31.95 billion. Sales in the quarter found support from Novo Nordisk’s diabetes treatments, as well as increased sales in obesity care and biopharm, offset by declining insulin sales.
NET PROFIT: Net profit for the three months ended Dec. 31 rose to DKK8.72 billion from DKK8.5 billion a year earlier, missing the DKK9.2 billion forecast by analysts in a FactSet poll.
WHAT WE WATCHED:
GLUCAGON-LIKE PEPTIDE-1: Sales of Novo Nordisk’s Ozempic glucagon-like peptide-1 products for type 2 diabetes–Victoza, Ozempic and Rybelsus–increased by 27% measured in Danish kroner and by 22% in local currencies to DKK33.2 billion in 2019. Sales growth was driven by both its North America and international operations, it said. Sales of Ozempic totaled DKK11.2 billion and Ozempic has now been launched in 26 countries. The GLP-1 segment’s value share of the total diabetes market has increased to 18.0% compared with 14.4% 12 months ago and Novo Nordisk said it has a 47.5% market share in the global GLP-1 segment.
MARGINS: The gross margin was 83.2% in the fourth quarter of 2019 compared with 84.4% in the same period last year. The decline of 1.2 percentage points of the gross margin reflects a negative impact from lower realised prices in the U.S. and a negative currency impact of 0.3 percentage point partly countered by a positive product mix. The EBIT margin rose slightly to 36.6% from 36.3%.
GUIDANCE: For 2020, sales growth is expected to be 3%-6% measured in local currencies, reflecting expectations for robust sales of the company’s diabetes-care products Ozempic, Victoza and Rybelsus, obesity-care product Saxenda, the portfolio of new-generation insulin and biopharm products Esperoct, Refixia and NovoEight. The guidance also reflects intensifying competition both within diabetes care and biopharm, as well as continued pricing pressure within diabetes care and affordability initiatives in the U.S., it said. Sales growth reported in Danish kroner is expected to be one percentage point higher than in local currencies. Operating-profit growth is expected to be 1% to 5% measured in local currencies. Reported in Danish kroner it is expected to be one percentage point higher than in local currencies. Capital expenditure is expected to be around DKK6.5 billion in 2020, primarily relating to investments in additional capacity for production within diabetes care.
https://www.marketscreener.com/NOVO-NORDISK-AS-1412980/news/Novo-Nordisk-Sales-Beat-on-Diabetes-Treatments-Earnings-Review-29943740/
Philippines keeps ports open to all ships despite virus fears
The Philippines said on Wednesday its ports remain open to all ships, even those from China, in order not to disrupt the cargo supply chain, but the crew of vessels arriving from the coronavirus-hit nation will be barred from disembarking.
All foreigners traveling from China and its two special
administrative regions – Hong Kong and Macau – are currently barred from
entering the Philippines amid a fast-spreading coronavirus outbreak
that has killed nearly 500 people in China.
A Chinese man who arrived from China’s Wuhan city, where the virus emerged last year, has also died in the Philippines.
Concerns about possible delays in shipments of Philippine nickel ore to China as a result of the port restrictions added to the upward pressure on nickel prices.
“As far as the ships are concerned, as far as the cargoes are concerned, we are business as usual,” said Jay Daniel Santiago, general manager at Philippine Ports Authority, allaying worries about delays in port operations.
He said ports particularly in the Philippine capital Manila are “fully mechanized” to facilitate cargo loading and unloading with minimal human intervention.
Nickel ore miners in the Philippines, a major source of the raw material for stainless steel production in China, usually resume shipments to their Chinese customers beginning March or April, after a seasonal stoppage starting the last quarter of the previous year.
“We have not yet started shipping out nickel ore, but we anticipate this virus outbreak in China would have no impact on the demand side,” Dante Bravo, president of Global Ferronickel Holdings Inc, the Philippines’ second-largest nickel ore producer and exporter, told Reuters.
“We believe this issue will be resolved soon given all the contingency measures put in place by all the parties concerned,” he said.
A Chinese man who arrived from China’s Wuhan city, where the virus emerged last year, has also died in the Philippines.
Concerns about possible delays in shipments of Philippine nickel ore to China as a result of the port restrictions added to the upward pressure on nickel prices.
“As far as the ships are concerned, as far as the cargoes are concerned, we are business as usual,” said Jay Daniel Santiago, general manager at Philippine Ports Authority, allaying worries about delays in port operations.
He said ports particularly in the Philippine capital Manila are “fully mechanized” to facilitate cargo loading and unloading with minimal human intervention.
Nickel ore miners in the Philippines, a major source of the raw material for stainless steel production in China, usually resume shipments to their Chinese customers beginning March or April, after a seasonal stoppage starting the last quarter of the previous year.
“We have not yet started shipping out nickel ore, but we anticipate this virus outbreak in China would have no impact on the demand side,” Dante Bravo, president of Global Ferronickel Holdings Inc, the Philippines’ second-largest nickel ore producer and exporter, told Reuters.
“We believe this issue will be resolved soon given all the contingency measures put in place by all the parties concerned,” he said.
https://www.marketscreener.com/news/Philippines-keeps-ports-open-to-all-ships-despite-virus-fears–29943776/
Virus outbreak delays India’s cotton exports to China
Shipments of around 250,000 bales of Indian cotton to China have been delayed by nearly two weeks as a virus outbreak and factory closures dampens demand from the world’s biggest consumer of the fibre, industry officials told Reuters.
The delay in shipments could pressure local prices and force the
state-run Cotton Corporation of India (CCI) to increase purchases from
farmers to ensure domestic prices stay above government mandated levels.
“As the holiday is extended in China, shipments are getting delayed,” said Chirag Patel, chief executive at Jaydeep Cotton Fibers Pvt Ltd, an exporter.
Most Chinese firms scale back operations or close for long periods around the Lunar New Year holidays, which began on Jan. 24 this year.
But China’s government has extended the holidays, announced widespread transport restrictions and told many businesses to stay closed longer to limit the spread of the virus. It is not clear when millions of migrant workers will be able to return to factories or when ports will resume normal operations.
The epidemic has killed nearly 500 people in China and infected more than 24,000 so far.
Indian sellers had contracted around 650,000 bales to China for prompt shipment.
Around 400,000 bales have already been shipped, but the remaining 250,000 bales have been delayed, three exporters and two dealers with global trading houses told Reuters.
“Exporters are a bit worried. So far buyers haven’t cancelled contracts, but some might be if this virus outbreak remains there for few more weeks,” said Vinay Kotak, a director at Kotak Commodities, a Mumbai-based brokerage.
China, Bangladesh, Vietnam and Indonesia are among key buyers of India cotton.
Exporters have an option of diverting cotton meant for China to other destinations such as Bangladesh and Vietnam if shipments are delayed further, Kotak said.
India has shipped 2 million cotton bales since the 2019/20 marketing year started on Oct. 1 and another 1 million bales have been contracted for shipment in February and March, said Atul Ganatra, president of the Cotton Association of India.
“We are hopeful that very soon Chinese buying will return to normal,” said Ganatra.
Local cotton prices are already under pressure due to surplus production, said a Mumbai-based dealer with a global trading firm.
“Chinese buying was supporting local prices. In the absence of China, Cotton Corporation of India will have to raise purchases,” the dealer said.
“As the holiday is extended in China, shipments are getting delayed,” said Chirag Patel, chief executive at Jaydeep Cotton Fibers Pvt Ltd, an exporter.
Most Chinese firms scale back operations or close for long periods around the Lunar New Year holidays, which began on Jan. 24 this year.
But China’s government has extended the holidays, announced widespread transport restrictions and told many businesses to stay closed longer to limit the spread of the virus. It is not clear when millions of migrant workers will be able to return to factories or when ports will resume normal operations.
The epidemic has killed nearly 500 people in China and infected more than 24,000 so far.
Indian sellers had contracted around 650,000 bales to China for prompt shipment.
Around 400,000 bales have already been shipped, but the remaining 250,000 bales have been delayed, three exporters and two dealers with global trading houses told Reuters.
“Exporters are a bit worried. So far buyers haven’t cancelled contracts, but some might be if this virus outbreak remains there for few more weeks,” said Vinay Kotak, a director at Kotak Commodities, a Mumbai-based brokerage.
China, Bangladesh, Vietnam and Indonesia are among key buyers of India cotton.
Exporters have an option of diverting cotton meant for China to other destinations such as Bangladesh and Vietnam if shipments are delayed further, Kotak said.
India has shipped 2 million cotton bales since the 2019/20 marketing year started on Oct. 1 and another 1 million bales have been contracted for shipment in February and March, said Atul Ganatra, president of the Cotton Association of India.
“We are hopeful that very soon Chinese buying will return to normal,” said Ganatra.
Local cotton prices are already under pressure due to surplus production, said a Mumbai-based dealer with a global trading firm.
“Chinese buying was supporting local prices. In the absence of China, Cotton Corporation of India will have to raise purchases,” the dealer said.
https://www.marketscreener.com/COTTON-16215/news/Virus-outbreak-delays-India-s-cotton-exports-to-China-trade-29943809/
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