Boston, Massachusetts – Cabot Corp. has withdrawn its financial guidance for fiscal year 2020 and is reducing planned capital expenditure in response to Covid-19 pandemic.
Despite a “solid” second quarter, ending 31 March, Cabot said it is withdrawing the outlook as future demand for the company’s products remain uncertain.
In addition, in order to maximise free cash flow, Cabot is looking to reduce previous plans for capital spending, said CEO and president Sean Keohane in a statement 30 March.
The company said it would update its 2020 outlook when it has more visibility into demand.
Cabot expects to deliver strong results for the three months to end of March, despite an adverse Covid-19 impact on sales volumes in China.
The company has linked the performance to “strong demand” outside China in January, February and early March.
In terms of measures taken against Covid-19, Cabot said it was following local regulations and guidance issued by relevant authorities.
The company has restricted global travel and allowed remote work wherever possible, and restricted access to its facilities to critical personnel only.
Cabot said it continues to supply its customers around the world and has contingency plans in place to respond to the needs of our customers.
“I remain confident that the underlying fundamentals of our businesses are strong,” said Keohane, “However, we are taking swift action to better align our cost structure and working capital needs to the near-term demand patterns.”