The Vicinity Centres (ASX: VCX) share price was out of form on Thursday and sank materially lower.
The shopping centre-focused property company's shares fell 20% to an all-time low of $1.03.
This was driven by broad selling in the industry due to concerns over the impact of the coronavirus outbreak on shopping centre operators like Vicinity and rivals Aventus Group (ASX: AVN) and Scentre Group (ASX: SCG).
Unfortunately, the Vicinity share price could come under further pressure on Friday after it provided an update on its guidance for FY 2020.
What did Vicinity announce?
Vicinity has announced that it is withdrawing both its FY 2020 funds from operations (FFO) per security earnings and distribution guidance. This follows the escalation in uncertainty surrounding the impact of the coronavirus on its operations.
The company's CEO and managing director, Grant Kelley, explained: "Since announcing our interim results in mid-February, we have seen a further deterioration in the retail trading and operating environment, with increasing uncertainty around the impacts of COVID-19. Given this, we have made the decision to withdraw our FY20 earnings and distribution guidance provided at that time."
"As always, our priority remains the safety, health and wellbeing of our employees, customers, retailers and the broader community, and we are following the recommendations of Federal and State health authorities to further prevent the spread of COVID-19. We recognise the impact COVID-19 is having here in Australia and will continue to work with our retailers during this period of adjustment," he added.
Strong balance sheet.
Mr Kelley was quick to point out that the company's balance sheet was strong. He noted that Vicinity is trading well within its covenants and has $1.3 billion of undrawn facilities.
It also has the flexibility to defer capital expenditure on major projects until COVID-19 uncertainties are resolved.
However, it intends to be prudent with its approach to capital management, and given volatile market conditions, it has suspended its securities buy-back program.
