The Atlas Arteria Group (ASX: ALX) share price is falling in morning trade today after the company released a business update regarding COVID-19 movement restrictions. At the time of writing, the Atlas Arteria share price is sinking 1.47% to $6.72. In comparison, the S&P/ASX 200 Index (ASX: XJO) is marginally down 0.2% to 6,546 points.
Let’s take a closer look at what is dragging the Atlas Arteria share price lower.
Recent lockdown measures taken by the French Government in late October resulted in softer traffic levels across the APRR network of roads. As COVID-19 cases continued to increase, the country entered a nation-wide lockdown in an attempt to halt community transmission of the virus. Essential businesses, such as factories, farms, construction sites, public administration offices, schools and childcare, remain open. People have been urged to work from home wherever possible and restrictions on movement is being enforced.
Despite the above, Atlas Arteria noted that traffic has been more resilient during the first two weeks of the second lockdown than when the pandemic first struck. In percentage terms, traffic is down roughly half of the reductions that were recorded in March and April. The company pointed out that November is seasonally one of the lowest traffic months for light vehicles on its roads.
Heavy vehicles using APRR’s toll road networks is tracking along very well, matching Q3 performance.
Similar to its neighbour, Germany entered a ‘lockdown light’ for a period of four weeks in early November. The measures taken involve the restriction of private gatherings and the closure of all entertainment venues. As a result, traffic levels have experienced weaker demand, around 20% to 25% lower than 2019.
Atlas Arteria noted that the current lockdown isn’t as strict as the earlier March-April lockdown in Germany.
At the end of Q3, the company reported traffic at 44.8% below 2019 levels. However, in the past two weeks alone, traffic has been slowly improving to record at 40% below the same period last year.
Until recently, restrictions in Virginia had continued to relax from July 2020. Authorities have encouraged people to work from home, but schools and kindergartens have progressively opened.
Atlas Arteria share price summary
The Atlas Arteria share price has steadily been catching up to where it was in February, during which it reached an all-time high of $8.54. Currently trading at a discount of 21% to this high, Atlas Arteria has a market capitalisation of $6.4 billion.
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