AT&S has already issued a profit warning for 2019/20 based on production stops in its Chinese factories in Shanghai and Chongqing II, which factored in three to four weeks of outages and slow ramps. The revenue guidance was cut from flat yoy (i.e. EUR 1,028 mn) to EUR 960 mn and the EBITDA margin range was reduced to 18-20% from 20-25%, which translates into a sales impact of about EUR 70 mn and an EBITDA impact of EUR 14-33 mn, according to our estimates.

Estimates by industry research company IDC from mid-February suggest a drag on Chinese ITC markets overall in 1Q 20, with the slowdown fading out in 2Q and normalising in 2H 20.