(RTTNews) - Providing a business update related to the coronavirus (COVID-19) impact, Tenneco Inc. (TEN) announced Friday that it is withdrawing its financial guidance for the first quarter and full year 2020 issued on February 20, 2020 amid the uncertainty driven by the unpredictability of the pandemic and associated negative impact on demand.
Tenneco said it will provide additional updates during its first quarter 2020 earnings call.
Tenneco also announced that it has temporarily suspended or reduced certain operations across the Americas, EMEA and most of the APAC regions in response to governmental requirements and production suspensions taken by many of its customers.
Where the Company is continuing operations, it is taking precautions at each location to implement rigorous cleaning and sanitation protocols; to perform wellness checks on employees; and to implement changes within the plant to comply with social distancing requirements.
Additionally, the company is implementing incremental cost reductions and actions to further optimize cash performance.
For the second quarter, overall salary costs will be reduced at least 25% through a combination of unpaid furloughs, net pay decreases and available temporary support programs in all regions Tenneco does business. The executive leadership team (the CEO's direct staff) will reduce their salaries 50% and the CEO will not take a salary in this period. The Tenneco Board of Directors annual retainer fees will be reduced by 25% for the remainder of 2020.
After the second quarter, overall salary costs will be reduced by at least 10% from the original levels for the remainder of 2020. The company intends that the more senior levels of the organization will receive 80 to 85% of their base salary in the third quarter and move to 90% in fourth quarter.
Capital expenditures in 2020 will be reduced to less than $400 million, compared to the guidance for 2020 expenditures between $610-650 million and 2019 expenditures of more than $700 million.
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