BUD Anheuser Busch Inbev SA NV

European food-and-drink and retail companies braced themselves for a coronavirus hit this week as markets were hammered by heightened worries around the spread of the epidemic to Europe. Blue-chip companies such as Nestle, AB InBev, Danone and Primark owner Associated British Foods were among the players commenting on the disruptions they expect from the virus, and the measures they are taking to mitigate them and protect their employees. Here's what they said:

 Nestle Tells Global Staff to Halt International Travel, Curtail Domestic Trips 

Nestle SA told more than 290,000 employees to suspend all international business travel until March 15, and requested that all domestic trips be skipped where possible for the time being.

"We take our responsibility for our employees and to the communities in which we operate seriously," a spokeswoman for the Swiss maker of Nescafe coffee and Purina pet food said Thursday. Nestle's announcement is among the first by a major multinational to restrict all its employees from flying anywhere.

 AB InBev Shares Dive as It Lost More U.S. Market Share, Took Hit From Virus 

Anheuser-Busch InBev SA stock fell after the world's largest brewer on Thursday said it lost $170 million of profits in the first two months of the year when the coronavirus outbreak curbed night life in China.

The world's largest brewer--which houses Budweiser, Stella Artois and Corona among its brands--also disappointed investors with its 4Q results, which reported a 75% fall in net profit to $114 million, driven largely by a failure to gain market share in the booming hard seltzers market.

Budweiser APAC, AB InBev's Asia Pacific business, said the coronavirus epidemic had so far cost the company $285 million in revenue in China. AB InBev expected first-quarter earnings to fall around 10%, which would be the sharpest quarterly decline in a decade.

 Danone Expects EUR100M Coronavirus Hit to 1Q Sales, Lowers 2020 View 

Danone said Wednesday during 2019 earnings reporting that it estimates a sales loss of around 100 million euros ($108.8 million) in the first quarter of 2020 due to the coronavirus outbreak. Danone's waters business in China was hit the hardest by the virus, the French food giant said.

 Primark Owner ABF Looks for Suppliers Outside of China Amid Coronavirus Outbreak 

U.K. conglomerate Associated British Foods PLC is operating its food-processing factories in China at reduced capacity and is looking for alternative suppliers to prepare for a prolonged slowdown in garment production in the country as the coronavirus outbreak spreads.

The London-based owner of fast-fashion retail chain Primark relies on China for a significant portion of its clothing and accessory supplies. Many of Primark's Chinese suppliers are operating below capacity because of travel restrictions and local quarantine requirements.

Primark, which operates 376 stores around the globe and represents around half of ABF's earnings before interest and taxes, has enough inventory to get through the summer months, Chief Financial Officer John Bason said Monday.

ABF has considered increasing orders from alternative suppliers in South and Southeast Asia, including in Bangladesh, Cambodia, Vietnam, Myanmar and India.

 Zalando Shares Slump as 2020 Guidance Excludes Coronavirus Implications 

Zalando SE's shares slumped Thursday after the company didn't include a potential hit from the coronavirus epidemic in its guidance for 2020.

While there is no coronavirus hit in the figures, the Berlin-based online retailer's warehouse in northern Italy may already be affected after the country became Europe's biggest outbreak hotspot in just a few days, Adam Cochrane, analyst at U.S. bank Citi, said.

Wayne Brown, analyst at U.K. investment bank Liberum, said the "lack of a coronavirus mention is clearly a concern," and that all the brands Zalando sells "will have varying degrees of impact," especially over the autumn and winter season.

Zalando said it expects revenue to grow between 15% and 20% in 2020, with gross merchandise volume--a key indicator for sales growth--rising between 20% and 25% and adjusted EBIT ranging from EUR225 million to EUR275 million.

 SSP Group Expects Fall in February Revenue, Operating Profit Due to Coronavirus 

SSP Group PLC said Wednesday that it expects a drop in February revenue and operating profit due to the impact of the coronavirus epidemic in Asia.

The food-and-beverage outlets operator said it expects overall group revenue to be reduced by about 10 million pounds to GBP12 million ($13 million-$15.6 million). It also expects a fall in operating profit in the GBP4 million to GBP5 million range.

Sales in the Asia Pacific region--which account for around 8% of group revenue--should be about 50% lower year-on-year, SSP said, adding it has seen sharp declines in both domestic and international air-passenger numbers at airports in China, Hong Kong, Singapore, Thailand, Taiwan, the Philippines, as well as Australia, India and the Middle East.

SMCP Shares Trade Sharply Lower After Warning of Significant Coronavirus Hit 

Shares in SMCP SAS fell Tuesday after it said sales and profitability in China are being substantially hit by the coronavirus epidemic.

The French luxury-goods company said a significant part of its stores in mainland China and Macau are temporarily shut and the virus "is having a material negative effect on Chinese consumption." Sales and profitability in other regions are seeing an effect of a lesser extent due to fewer Chinese tourists, the company said.

Write to Barcelona editors at barcelonaeditors@dowjones.com

(END) Dow Jones Newswires

February 27, 2020 11:55 ET (16:55 GMT)

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