“Our hearts go out to all those affected by the coronavirus globally, and specifically in the local communities where our employees and customers live, work, and raise their families,” says Robert W Bryant, Axalta’s President and CEO. “We continue to focus first of protecting their health, safety and well-being. In support of designated essential customer activities, our manufacturing sites continue to meet customer demand with operating procedures implemented to maintain social distancing and increased sanitizing procedures. Our supply chain remains stable, and we are mitigating potential risks in close coordination with our suppliers. Nonetheless, there have been notable demand impacts in countries impacted by COVID-19, with the majority of our customers experiencing demand declines, with the possibility of a phased recovery beginning gradually in coming weeks.”
Axalta’s management has taken and continues to take immediate actions to address COVID-19 related demand impacts. “These included significant reductions in discretionary costs, as well as elimination of temporary labour, employee furloughs, and work hour reductions across our businesses. Axalta has also instituted temporary salary reductions for eligible employees globally including a 20% salary reduction for senior management and a 20% reduction in the cash compensation for our Board of Directors. In addition, the company is focused on maximising cash flow and liquidity and has reduced capital expenditures versus prior plans as well as taking further steps to drive working capital efficiency during this period.”
Bryant commented; “This is an unprecedented business climate, and Axalta is taking aggressive steps to adjust our cost structure in real time with expected demand changes to ensure that we preserve our balance sheet strength and ultimately emerge from this crisis in a position of strength. In our response planning, we have considered our employees needs, the long-term health of the business, maximising long-term shareholder value, and the requirements of our diverse customer base.”
Bryant continued, “Axalta is structurally well positioned to adjust to demand disruptions given our highly variable cost structure, the actions we are taking to incrementally adjust fixed costs, and our strong balance sheet. We have previously noted that we entered this demand downturn with a strong liquidity position, and this remains the case today.
“We are also very proud to be working in support of our employees and communities in the direct effort to mitigate the coronavirus spread. Since March, we have been working to support the safety, health, and well-being of hospital professionals, first responders, and our employees,” said Robert Bryant. “We are putting our manufacturing capabilities and supply inventories to work in order to offer products that will make a difference where they are needed most. These efforts include the production of thousands of gallons of hand sanitizer at many of our global sites to be donated to local hospitals and first responders. They also include the donation of personal protective equipment (PPE) such as N95 face masks, coveralls and seat covers to hospitals and medical professionals in numerous countries where we operate.”