Malaysia’s Top Glove posts over 20-fold jump in first-quarter net profit

Photo by Clay Banks on Unsplash

Malaysia’s Top Glove Corp on Wednesday posted a more than 20-fold jump in first-quarter net profit to a record high, as the coronavirus pandemic boosted demand for protective rubber gloves and selling prices.

Net profit for the September-November period grew 2,030% to 2.38 billion ringgit ($585.49 million) from 111.4 million ringgit a year ago. Revenue rose 294% to 4.76 billion ringgit, the world’s largest rubber glove maker said.

The performance was slightly below the 2.48 billion ringgit estimate by one analyst polled by Refinitiv.

“We have had a strong and healthy start to FY2021, which sets a positive tone for the rest of the year,” Managing Director Lee Kim Meow said in a statement.

The company estimates that glove demand will grow by 20% this year, 25% next year and 15% post-pandemic.

Delivery times have increased significantly due to the strong demand, with nitrile gloves currently taking up to 510 days to deliver, the company said on an earnings call with reporters, adding that there will be a global shortage of gloves for the next three years.

Lee also said on the call that Top Glove was in the final leg of talks with the U.S. Customs and Border Protection, which banned products from two of the company’s units in July due to allegations it was using forced labour.

“We foresee that we are closer to the tail end,” he said.

The United States banned the Top Glove products after it found evidence of forced labour practices, including debt bondage.

Top Glove had been working towards resolving the issues, including agreeing to pay recruitments fee for its migrant workers and improving accommodation facilities.

Top Glove shut some of its factories in Malaysia in phases last month after an outbreak that saw more than 5,000 of its workers test positive for COVID-19.

The company said the temporary closures would affect sales and production by 4% this financial year.

Shares of the firm fell 3.8% on Wednesday but have climbed 335% so far this year.

Reuters

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.