EINDHOVEN, NETHERLANDS -- Neways today said all its operating companies in the Netherlands, Germany, the Czech Republic, Slovakia and China remain operational at this time.

The EMS company expects a greater impact on operations in the second quarter as a result of delays in the supply of components and the temporary closure of client production facilities, especially in the automotive sector. The borders of some countries where its suppliers are located have been temporarily closed and it is unclear when these borders might reopen or whether further restrictions will be imposed, the firm added.

Neways said it is currently limiting operating expenses, using government funds and subsidies for the temporary reduction of working hours, cutting investment plans, and looking at more stringent monitoring of working capital, in particular receivables and inventories.

Neways said its financial position is sound, with good access to credit lines, but noted "insufficient clarity" over the duration of the Covid-19 situation and its potential impact on clients. "To safeguard its healthy financial position Neways is focusing on cash management and maximizing its available cash in the coming period.

The company withdrew its financial guidance for 2020.

In a statement, CEO Eric Stodel said, "In these unique circumstances, the health of our employees and their relatives is our top priority, in addition to maximizing the continuation of our global operations. I am extremely proud of the flexibility and resilience of our employees, who are doing their utmost to minimize the impact for our clients. In this period, we rely even more on cooperation and mutual understanding between all the parties involved. We are therefore cooperating even more closely with our suppliers and clients to limit the impact for everyone active in the chain."