The impacts of severe flooding on April 11 and 12 across most of the KwaZulu-Natal province in South Africa have impacted a major original-equipment manufacturer (OEM) customer of JSE-listed Metair.
The OEM has advised Metair that it suffered significant damage to its plant, with production suspended for clean-up operations and assessments to be carried out.
There is no certainty yet on the timing of production coming back online; however, Metair’s automotive components vertical expects a material reduction in demand for its products until then.
Metair has insurance in place and has initiated a business interruption claim which would limit the impact to the automotive components vertical’s earnings.
Metair also says it will work with the affected OEM to support its recovery and any recoupment of lost production.
Moreover, the company notes that it is in close contact with its funders to maintain sufficient short-term liquidity until the situation stabilises.
The impact of flooding on Metair’s facilities was minimal and operations had promptly returned to normal.