StockMarketWire.com - Underwater cable protection systems provider Tekmar warned of a flat annual earnings performance following delays and supply issues caused by China's response to the coronavirus.

In a trading update for the year through March, Tekmar said all of its projects scheduled for shipment to China had been delayed.

There was little visibility as to when travel restrictions would be lifted, it added.

The supply of components from China had ceased, pending further notice, prompting Tekmar to consider sourcing replacement components from Europe.

Any resulting delay from sourcing outside of China would not affect contractual delivery schedules for clients, the company said, though it would affect the timing of revenue recognition and margins.

The company's office in Shanghai, meanwhile, had been placed on official shutdown, as had many clients' and suppliers' offices in the region.

Tekmar said that China accounted for about 10% of its revenue forecast in the 2020 financial year and represented 20% of its outstanding supply-chain commitments.

'The disruption caused by the outbreak of the coronavirus on the group's activities and performance has been unpredictable and rapid, impacting the group materially in our crucial, heavily weighted fourth-quarter period,' chairman Alasdair MacDonald said.

'With the situation in China and the surrounding APAC countries evolving, we are not yet able to evaluate the full impact of the virus on the 2021 financial year and will provide further updates as necessary.'

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