Andritz has issued its 2020e earnings guidance excluding potential disruptions from the coronavirus. According to CEO Leitner, most of it 3,600 employees in China are already back to work and plants are operating as Andritz managed to secure several hundreds of thousands of facemasks for its employees ahead of the Chinese New Year holidays. First shipments from Chinese plants are expected in the first week of March. Below, we show Andritz's 2019e revenue exposure to China, with 11% of 2019 orders from China indicating a decreasing exposure. We also reckon that about 10% of Andritz's purchasing volumes were sourced in China, based on external procurement data. Management indicated that there have been delays for hundreds of orders and declarations of force majeure but reckons that the situation could reverse with four to eight weeks.

However, Andritz also has small business units in the North of Italy, which could also suffer from the local outbreak's impact on operating hours. We estimate sales from Italian units (e.g. Farina, Diatec, Novoimpianti) in a mid-double-digit EUR mn amount per year.