The Select Harvests Limited (ASX: SHV) share price is pushing higher in afternoon trade on Friday.
The almond producer’s shares are up 0.5% to $9.01 after providing a coronavirus update.
What did Select Harvest announce?
This afternoon Select Harvest became the last company to provide an update on how the coronavirus outbreak might impact its business.
This follows similar updates by companies ranging from Blackmores Limited (ASX: BKL), Crown Resorts Ltd (ASX: CWN), Flight Centre Travel Group Ltd (ASX: FLT), and Treasury Wine Estates Ltd (ASX: TWE).
How will Select Harvests be impacted by the coronavirus?
According to the release, there has been no material short-term impact on its financial performance from the outbreak.
However, management acknowledges that there is significant global uncertainty about the impact the outbreak could have on supply chains and consumer demand.
It revealed that the company has just commenced its harvest and marketing campaign for the 2019/2020 crop.
It expects a near term softening in almond prices and demand because of the outbreak. But the extent and duration of these conditions will depend on when the virus can be contained and how soon the Chinese supply chain and factories return to normal.
Pleasingly, although some raw materials are sourced from China, a review of its inventories shows that there are no immediate issues that would impact its ability to service its customers.
In the meantime, the company continues to market its products domestically and in its traditional markets of India, the Middle East, and Europe.
Management advised that it intends to monitor the situation and will update the market when appropriate.
One investment company that doesn’t appear concerned that the coronavirus will have a big impact on the company is Vinva Investment Management. Earlier this week it became a substantial holder in Select Harvests with a stake of just over 5%.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited, Crown Resorts Limited, Flight Centre Travel Group Limited, and Treasury Wine Estates Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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