TOP GLOVE NARROWS NET LOSS TO RM51.2 MLN IN 2Q

KUALA LUMPUR, March 20 (Bernama) -- Top Glove Corporation Bhd reduced its net loss to RM51.20 million in the second quarter ended Feb 29, 2024 (2Q FY2024), from RM164.67 million a year earlier on an uptrend in sales orders.

However, revenue for the quarter decreased 11 per cent to RM550.33 million from RM618.01 million previously.

For the first half-year, the group narrowed its net loss to RM108.91 million from RM332.90 million in the preceding year’s corresponding period, while revenue dropped to RM1.04 billion from RM1.25 billion, the world’s largest glove manufacturer said in a filing with Bursa Malaysia today.

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“The group’s steady recovery was fueled by stronger sales volume growth, as customers placed new orders following the depletion of excess inventory.

“The uptrend in sales orders was further spurred by the progressively narrowing price gap which has seen Top Glove achieve parity in average selling prices (ASPs) with its overseas peers,” it said.

Top Glove said the uptick in orders, which boosted production utilisation, resulted in enhanced production and cost efficiency, impacting the bottom line positively.

“Ongoing quality and cost optimisation initiatives, coupled with operational enhancements outlined in the Top Glove Turnaround Plan, also underpinned the group’s improved set of results,” it said.

Meanwhile, managing director Lim Cheong Guan said the strong glove demand continued in March 2024, a good indication that customers were returning to replenish their depleted stock.

“Our ASPs have been adjusted to reflect the higher raw material prices in 2Q FY2024.

“The smaller selling pricing gap between Malaysian and foreign manufacturers gives customers a better choice of outsourcing orders to Malaysian glove manufacturers. With the pricing gap narrowed, sustainability may be a consideration for customers when selecting glove manufacturers,” he said during the company’s online financial results briefing today.

He also said natural rubber latex concentrate prices are expected to soften in May 2024 and nitrile latex prices in June 2024.

“The mismatch of ASPs and raw material cost will be to our advantage once the raw material price trends downward,” he said. 

Lim is confident of Top Glove’s ability to sustain the positive trajectory and return to profitability within the second half of this year.

“We continue to see signs of the market rebounding and believe our business will normalise in due course as glove industry fundamentals remain robust and unchanged.

“We remain focused on executing our strategic initiatives to level up our quality and cost efficiency while leveraging our strengths to capitalise on emerging opportunities,” he added.

-- BERNAMA