At least 21 firms listed on the Singapore Exchange have temporarily shuttered their factories, offices and retail shops in Malaysia to comply with the country’s restricted movement order.
The order, which kicked in on Wednesday (Mar 18) and will last until the end of the month, was aimed at curbing the spread of COVID-19 in the country. Businesses affected range from manufacturers, miners to developers, according to bourse filings since Tuesday. A majority of them said they are still assessing the financial impact of the temporary halt, and some already foresee some impact.
Those companies fear that the closure and any extension for a prolonged period will negatively impact its cash flow and financial position as certain fixed costs will still need to be paid, such as wages, during the shutdown.
On the other hand, some businesses have been allowed to continue operations as they fall under the scope of essential services.
Mainboard-listed glove maker Riverstone Holdings explained: “The manufacturing of medical gloves and face masks has been deemed by the authorities as an essential industry, as healthcare practitioners around the world continue to grapple with the virus.”
The Malaysian-based firm manufactures nitrile and natural rubber cleanroom gloves that are used in highly controlled environments, as well as premium-nitrile gloves used in the healthcare industry.
Micro-Mechanics’ has also been allowed to continue operating its factory in Penang, which primarily serves customers in Malaysia and accounted for about 16 per cent of total revenue in the six months ended Dec 31 last year.
“As semiconductors are listed on the government’s ‘List of Products that are Part of the Supply Chain of Essential Goods Supply Chain for Exemption from the Restriction of Movement’, the group can continue its operations in Penang at a minimal level,” it said in a filing.
Malaysian Prime Minister Muhyiddin Yassin has warned that the country may extend the restricted movement order by “maybe another two weeks or even longer” if the current measures fail to contain the spread of the novel coronavirus.
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