Top Glove Q3 earnings jump to RM42.4m

KUALA LUMPUR: Top Glove Corp Bhd’s third-quarter earnings ended May 2014 was 5.2 per cent higher at RM42.37 million from RM40.27 million a year ago, thanks to foreign exchange gains and improved performance at its China factory.

The world’s largest rubber glove manufacturer yesterday said it maintained a net cash position of RM184.4 million and a healthy balance sheet as at May 31  2014. It also declared an interim dividend of seven sen a share, payable on July 17. 

Top Glove had gained from cheaper raw materials as natural rubber is now trading at its five-year low.

When compared with its second-quarter results ended February 2014, nitrile latex price remained at an average of RM3.55/kg while natural latex price settled 3.5 per cent to an average of RM4.65/kg. 

 Top Glove’s sale of the loss-making Factory 8 in Zhangjiagang, China, to Qian Guo Hua, Chen Xing Yin and Qian Xin Ru for RM22 million was completed last Friday. This consolidation exercise is part of the group’s ongoing cost rationalisation to enhance efficiency.

Top Glove’s remaining Factory 15 in Xinhua, however, is expected to contribute positively in the months ahead.

Chairman Tan Sri Lim Wee Chai said the group’s expansion plans is on course, with six more nitrile glove lines at Factory 27 in Lukut, Port Dickson, coming onstream in two months. The construction of new glove production lines at Factory 29 in Klang is also underway and slated for completion by the end of the year. This will boost the group’s capacity from 42 billion to 44 billion pieces of gloves per annum.

Lim also expects continued challenging business environment. 

However, with prudent cost control across all aspects of operations, he is confident Top Glove is well-positioned to capitalise on the global robust growth momentum in the quarters ahead.