5 companies worried about Ukraine
The crisis in Ukraine is making itself felt in corporate earnings reports.
Tensions escalated on Thursday as Russia said it would hold military exercises along the Ukrainian border.
The move put pressure on the broader stock market.
Some companies are already attempting to factor the geopolitical conflict into their business plans, at least as told through their earnings reports and calls.
Here’s a look at five companies that have commented on the ongoing tensions.
Caterpillar Inc. CAT , in its earnings release Thursday, had this to say:
“We are closely monitoring political developments in Russia and Ukraine and are concerned that escalation could dampen growth and that government trade sanctions could be negative for sales in the CIS [Commonwealth of Independent States]…
“The current political situation is not expected to materially impact the overall Caterpillar 2014 outlook unless the crisis sharply escalates and impacts business confidence around the world, trade and world GDP.”
Here’s D. Scott Davis, chairman and chief executive officer of United Parcel Service Inc. UPS -0.61% , in an earnings call Thursday:
“In Europe, the economy is showing signs of recovery and faster growth. Yet, if the situation in the Ukraine deteriorates, that pace may slow.”
Brett Begemann, president and chief operating officer of Monsanto Co. MON , spoke about Ukraine in the farming biotech company’s earnings call on April 2:
“It’s difficult to speculate on what could happen over there because it can change overnight. But I would tell you that there’s — the two breakouts I’d make for you is, there’s the larger farming operations that are over there that are well capitalized and feel good about their business. Then you have the smaller farmers in the country that rely more on credit from retailers, et cetera. The smaller ones are impacted more than the large ones. If the disruption was to intensify, I would expect the disruption to intensify more for the smaller ones than the larger ones, which gives us the cautious optimism that we can work our way through this for the year. I’d never suggest there’s no impact, it’s just a manageable impact as we go through the year.”
In response to a question about emerging markets during the Citigroup Inc. C -0.04% earnings call on April 14, CEO Michael Corbat said:
“We’ve kind of transitioned out a bit of the year end malaise, which was largely focused around Fed policy or Fed stance, and I think we’ve seen volumes pick up and I think confidence result as part of that. But at the same time, I don’t think you can ignore what’s going on in the Ukraine or in Russia; that those things clearly continue to have an overhang on the market. So I think the overall sentiment is better but I think there’s still some things out there, which I think caused people pause.”
Pernod Ricard SA FR:RI +0.04% , the maker of Martell Cognac, has seen disruptions in its Ukraine business. Chief Executive Pierre Pringuet said Thursday:
“Sales in Russia grew 4% in the first nine months of the group’s fiscal year ending in June, compared with 17% in the same period a year ago. In Ukraine, the political situation has also caused sales to drop sharply.”
(By Ben Eisen)
Source: marketwatch
