The group achieved sales revenue of RM4.8bil, up 294% compared with 1QFY2020, and 53% quarter-on-quarter. KUALA LUMPUR: Top Glove Corporation Bhd continued to register super normal profits in the first quarter ended Nov 30 (1QFY2021) as its net profit hit RM2.4bil and it rewarded shareholders with a dividend of 16.5 sen a share. In its announcement on Wednesday, the world’s largest glove maker said its earnings had surged by 20 times from a year ago and even doubled against the preceding quarter. It achieved sales revenue of RM4.8bil, up 294% from a year ago and 53% quarter-on-quarter. Top Glove said sales volume or quantity sold improved by a healthy 34% from a year ago. “The group’s robust sales figures were attributed to the strong demand for gloves in both developing and emerging markets, owing to the ongoing global 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 (ASPs) in line with market pricing, ” it said. Top Glove also said its move 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 bottomline. The uptrend in raw material prices continued, as natural latex concentrate increased 13% to an average of RM5.14/kg and nitrile latex jumped 39% to an average of US$1.31/kg quarter-on-quarter. Top Glove said these factors were driven by less favourable weather conditions and supply constraints, against a backdrop of increased glove demand. Due to the strong global glove demand which it said was estimated to grow from a pre-pandemic level of about 10% per annum, to about 15% per annum post-pandemic following increase in usage coupled with heightened hygiene awareness, the Group will continue to pursue organic expansion, inorganic expansion and strategic investments. It had allocated RM10bil for capital expenditure over the next five years from FY2021 to FY2025, which will increase capacity by an additional 100 billion pieces of gloves and based on its organic expansion plans. Its managing director Datuk 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 said as a growing business, the company has 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. On the outlook, Lee said 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% per annum in 2020,25% per annum in 2021 and 15% per annum post-pandemic, ” he said.Lee added the company has a strong and healthy start to FY2021, which sets a positive tone for the rest of the year.
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