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Companies operating in Russia and Ukraine began putting into place contingency plans, as they confronted a host of challenges and sliding share prices following Moscow’s attack.
Executives began closing offices and factories Thursday, ensuring staff were safe and sending some to the Polish border, while weighing factors likely to hit their businesses, including soaring commodities prices and the potential impact of further sanctions on Russia. Some in Ukraine were dealt additional challenges that made work difficult, including the closure of the rail network and ports and problems with gas supplies.
The invasion rippled through boardrooms around the world. “Today is a dark day for all of us. The attack on Ukraine represents a turning point in Europe; a war was simply unthinkable for many people, especially the younger generations,”
chief executive of
Siemens Energy AG
, told shareholders at their annual meeting.
A/S, the Danish brewer, said it was closing down three breweries in Ukraine and asked employees to stay at home and await instructions from local authorities. One of its breweries, in the city of Lviv, was temporarily closed because of disruption in the supply of natural gas.
The company, which has 1,300 employees in Ukraine and a large business in Russia, said it was following the situation with concern. “As of this morning, we have implemented several measures to ensure the safety and well-being of our employees in Ukraine,” a spokeswoman said.
Nestlé SA said it had temporarily closed its factories, warehouses and supply chain in Ukraine, and recommended its employees stay home. The company said it had taken the measures to ensure the safety of its workers, and that it was adapting its plans in line with the changing environment. Nestlé, which has three factories and about 5,000 employees in Ukraine, added that it had contingency plans in place to ensure it could restart the supply of its products when safe to do so.
the world’s second-largest steelmaker, said it was slowing production at its large plant in Ukraine and has halted production at its underground mines. The company has a series of contingency plans should the situation escalate.
Hamburger Hafen und Logistik AG
, which runs a large container terminal at Ukraine’s Odessa port, said that Ukrainian authorities closed the port Thursday morning, and that its 480 employees had left the site.
Elsewhere, Davidoff cigarettes maker
PLC suspended operations in Ukraine, where it has 600 employees across a Kyiv factory and a sales and marketing team. German software provider
said it had closed its Kyiv office and taken safeguarding measures to support its employees. French food maker
which has two manufacturing plants in Ukraine, said it was taking action to ensure the safety of its employees and business continuity.
As Russian tanks rolled in, Global Guardian, a U.S. firm that advises businesses on security risks, used buses to take 200 workers from international financial services, legal and other office-based companies operating in Ukraine to Poland.
the company’s chief executive, said it had evacuated around 1,500 mainly foreign nationals ahead of Thursday’s incursion. The U.S. Special Forces veteran said his clients had a further 2,800 Ukrainian and foreign nationals who could also be evacuated depending on whether Moscow escalates its military action further.
Other companies, such as Irish construction materials business
PLC, with five manufacturing plants in Ukraine, said it was yet to trigger contingency plans.
Shares of companies with operations in Ukraine and Russia traded lower Thursday, with ArcelorMittal down more than 6%, Danone finishing more than 4% lower and Carlsberg off nearly 2%.
Investors also sold off shares of oil major
PLC, which fell more than 4%, despite rising commodity prices. The British energy giant holds a 19.75% stake in Russia’s
Rosneft Oil Co.
A spokeswoman for BP said the company was monitoring the situation. BP executives earlier this month played down the potential risks of sanctions as tensions escalated.
Other major oil companies, including
Exxon Mobil Corp.
have large investments in Russia, too. “The safety of all our staff is Shell’s highest priority. We are monitoring the situation closely,” a company spokesman said. A spokesperson for Exxon Mobil wasn’t immediately available for comment.
Companies said they were also on alert for any disruptions to operations in Russia.
said the impact was “continuously determined by a crisis team,” while
Mercedes-Benz Group AG
said it was in constant contact with the leadership of its manufacturing plant near Moscow.
Businesses said uncertainties abounded, including regarding the extent of Russia’s incursion and the scope of potential sanctions that could follow. Western leaders have pledged sanctions that will place export controls on key technology to Russia, hit its banking sector and target its biggest businesses and wealthy individuals. These could also hurt Western companies that have joint ventures with, or investments in, Russian companies.
German home and personal-care products company
& Co. KGaA said it was viewing the situation “with great concern.”
“The exact extent, including that of the further sanctions to be expected, is still difficult to estimate,” a spokeswoman said. The company employs around 2,500 people in Russia and 600 employees in Ukraine at four production sites, two of which are located in the southeastern part of the country.
Explosions, Airstrikes, Disbelief: Russia’s Attack on Ukraine
Russian forces advance toward Kyiv, while inhabitants of the capital city flee or brace for onslaught
Ukrainian defense fighters received weapons and ammunition in Kyiv on Friday.
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The Eastern Committee of German Business, a lobby group representing German firms with investments in Russia and Eastern Europe, said Thursday that it has canceled a planned meeting with Russian President
The annual event was scheduled for early March. The committee, which has in the past opposed sanctions against Russia, said it informed Moscow that the meeting couldn’t take place in the current circumstances.
Ukrainian businesses anticipate the greatest hit.
PLC, one of the world’s largest exporters of high-grade iron-ore pellets to the steel industry, said that its mining and process facilities were still operating but that the government had suspended rail services.
one of the many farmers whose business make up the largest part of Ukraine’s economy, war came with a loud explosion in the early hours of Thursday.
“We can’t work on the fields today and are scared,” she said. Her Agro-focus Ltd is Ukraine’s largest asparagus farm and based in the south of the country, near Crimea. Last week, it was planting its new crop, much of which would usually be exported.
Any disruption to Ukraine’s agricultural industry will be economically painful. Agricultural products are Ukraine’s largest export, and the sector accounted for 14% of gross domestic product in the third quarter of 2021, according to the country’s statistics service.
Disruptions to Ukrainian corn exports, in particular, could be felt by Chinese pork producers and in countries like Egypt, Indonesia, Turkey and Pakistan, who are big buyers of the crop.
Ms. Boden’s business had already been affected by tensions in the buildup to Russia’s incursion. The price of the fuel it uses was up 30%. A bank that Agro-focus had been negotiating a loan with has put those talks on hold. Even before the bombing began, Ms. Boden was concerned that the seasonal workers farms depend upon would leave to work in more stable countries.
Now that Russia has invaded, “there is no contingency plan,” she said. “We try not to panic.”
—William Boston, Nick Kostov, Jenny Strasburg and Saabira Chaudhuri contributed to this article.
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