US-based alloy producer, Haynes, has decided to drastically scale down operations at its Kokomo Indiana facility to combat the spread of COVID-19. The plant runs melting operations and manufactures flat products out of the facility.
Haynes has implemented staggered shifts for its employees and has put in place cleaning and sanitising processes between shifts.
Haynes will implement a partial shutdown of operations as part of the US Centres for Disease Control and Prevention’s (CDC) social distancing recommendations.
The company’s pipe and tube facility in Arcadia, Louisiana, will operate at reduced capacity and its wire facility in Mountain Home, North Carolina will operate with reduced staff to cater to customer orders.
Haynes has also decided to lay-off non-essential salaried employees. The measures will be implemented for two weeks, said the company on Monday.
In January, Haynes had alluded to business challenges in the aerospace market arising from the uncertainties around the production of Boeing 737 MAX. Boeing had temporarily stopped production of 737 MAX in January. Haynes shipped 4.2mn lb of finished products in the first quarter of 2020, down by 1.2mn lb from a year ago, and down 0.1mn lb from the 5.4mn lb shipped in the fourth quarter of 2019. The company earns close to 50pc of its revenues from the aerospace business segment.
In January, Haynes expected second quarter (Q2,2020) earning revenues to be lower than a year ago, but higher than the last quarter (Q12020). However, full-year earnings were expected to be higher than compared to last year. For Q12020, Haynes net revenue was $108.5mn compared to $107.1mn a year ago and net income was $3.3mn compared to a net loss of $1.6 million in Q12019.
With the unprecedented global clampdown of airline operations due to COVID-19, the airline industry is slated to face additional difficulties. Boeing said on Monday that it will suspend operations at its Seattle facilities to battle the spread of the virus.
Despite the impact of COVID-19, Hayes has expressed confidence in its financial performance and its liquidity position.