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.