Top Glove: Earnings surged 20 times compared to a year ago
Leading rubber glove manufacturer Top Glove Corporation Bhd announced massive profits in the first quarter of its financial year as its earnings surged by 20 times from a year ago and even doubled against the preceding quarter.
In a statement today, the world’s largest glovemaker said that it ended the first quarter of its financial year (Sept 1 - Nov 30) with a net profit of RM2.38 billion from RM111.43 million a year earlier.
It was able to reward shareholders with a dividend of 16.5 sen a share.
It said the robust performance was underpinned by continued strong global...
Leading rubber glove manufacturer Top Glove Corporation Bhd announced massive profits in the first quarter of its financial year as its earnings surged by 20 times from a year ago and even doubled against the preceding quarter.
In a statement today, the world’s largest glovemaker said that it ended the first quarter of its financial year (Sept 1 - Nov 30) with a net profit of RM2.38 billion from RM111.43 million a year earlier.
It was able to reward shareholders with a dividend of 16.5 sen a share.
It said the robust performance was underpinned by continued strong global glove demand. Top Glove is believed to command a 26 percent share of the global rubber glove market.
Top Glove has achieved sales revenue of RM4.8 billion, up 294 percent from a year ago and 53 percent quarter-on-quarter, with sales volume, or quantity sold, improving by 34 percent from a year ago.
"The group’s robust sales figures are attributed to the strong demand for gloves in both developing and emerging markets, owing to the ongoing global Covid-19 pandemic.
"The improved profit came on the back of higher sales output, high utilisation levels which amplified production efficiency, as well as higher average selling prices in line with market pricing.
"Moreover, ongoing technological advancements towards automation and digitalisation initiatives, effective talent development, as well as continuous innovation, quality and productivity enhancements which the group continued to embark on, also contributed to the improved bottom line," said Top Glove.
Top Glove's managing director, Lee Kim Meow said the strong performance in the just-ended quarter was due to the 21,000 workers who have worked very hard, smart, and fast to ensure its gloves reach those who need it the most, despite several operational challenges.
He added that as a growing business, the company had provided employment to around 6,600 personnel comprising 4,945 new and experienced hires, as well as 1,655 interns/trainees over the past one year, thereby contributing to overcoming unemployment within the country.
This also includes 3,080 local workers for its manufacturing operations towards reducing dependency on foreign labour.
Lee said that despite the challenging and competitive landscape, Top Glove maintains an optimistic outlook on prospects.
“With the pandemic, Top Glove estimates that glove demand will keep growing, by 20 percent per annum in 2020, 25 percent per annum in 2021, and 15 percent per annum post-pandemic,” he said.
However, the year has not been entirely smooth sailing for Top Glove after a ban on its subsidiaries - Top Glove Sdn Bhd and TG Medical Sdn Bhd - by the United States Customs and Border Protection (US CBP) in July over ‘forced labour’ concerns.
More than 4,000 of its workers were also infected by Covid-19, making them the largest contributor to Malaysia’s Covid-19 cases with a cluster dubbed as “Teratai”.
The Department of Labour Peninsular Malaysia also opened 19 investigation papers against Top Glove for failing to comply with the Workers' Minimum Standard of Housing and Amenities Act 1990 (Act 446).
This was after the department conducted simultaneous operations on the glove manufacturer's workers' accommodations in five states, namely Perak, Kedah, Kelantan, Negeri Sembilan, and Johor, on Nov 26.
Malaysia supplied 240 billion pieces of rubber gloves globally, meeting almost 70 percent of 360 billion pieces of world demand in 2020, making it the leading industry player amidst a pandemic that has infected over 65 million and claimed 1.5 million lives globally.
Aside from Top Glove, Hartalega Holdings Bhd, Supermax Corp Bhd and Kossan Rubber Industries Bhd were consistently in the limelight as the demand for rubber gloves spiked not only for medical but also non-medical purposes, especially in the food and beverages sector.
Their massive financial numbers have also prompted calls for a windfall tax by former minister Syed Saddiq Syed Abdul Rahman.
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