Amphenol’s 1Q profits down 9.4% as company withdraws forecast amid COVID-19 uncertainty

Photo | Contributed Amphenol's oval contact system connector is one of many products it makes.

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Wallingford connector and cable maker Amphenol Corp. announced Wednesday its first quarter profits shrunk 9.4% as the coronavirus pandemic significantly impacted its global operations, including forcing it to shut down its operations in China for three weeks.

“Since the shutdown of Wuhan, China on January 23, Amphenol’s entire global organization has been managing through the extreme challenges created by the outbreak,” said Amphenol President and CEO R. Adam Norwitt.

Amphenol, which warned in February it wouldn’t meet its first-quarter projections, said it recorded profits of $242.1 million, or 79 cents per share, during the January-to-March period, compared to $267.5 million in profits, or 87 cents per share, in the year-ago period.

The company’s first-quarter revenues fell about 5% to $1.86 billion

Underscoring the challenges to figuring out the total economic impact from the pandemic, Norwitt also said he was withdrawing the company’s full-year sales and earnings guidance, which is rare for publicly traded companies to do.

Amphenol’s stock price Wednesday morning was trading at $78.21 at 10 a.m., up 1.68%, from Tuesday’s close.

Norwitt said the company has drawn on its credit line, “out of an abundance of caution,” giving it $2.4 billion in cash on hand.

“As we look ahead, the overall demand and operating environment remains highly uncertain,” Norwitt said. “The full impact of the COVID-19 pandemic on our business will depend on many unpredictable future developments, including the length and severity of the crisis, potential additional government actions and the overall impact of the pandemic on the global economy, among many other factors.”

China is a major market for Amphenol.

The country constituted about 28% of the company’s net sales last year, according to Amphenol’s recently released annual report. It’s not clear how many of Amphenol’s employees are based in China, but about 90% of its workers operate outside the U.S.

The company’s website lists 52 Chinese locations.

Amphenol is far from the only Connecticut manufacturer being affected by the ongoing health crisis the virus poses. Other global players like Stanley Black & Decker and Raytheon Technologies Corp. are also seeing effects, instituting furloughs, travel bans, layoffs and pay cuts.