Hartalega Q4 earnings up 11.7% to RM54.93m

KUALA LUMPUR: Hartalega Holdings Bhd’s earnings rose 11.7% to RM54.93mil in the fourth quarter ended March 31, 2015 from RM49.15mil a year ago, boosted by higher sales and an adjustment of tax rates.

The world’s largest synthetic glove manufacturer said on Tuesday its revenue increased by 8.8% to RM305.11mil from RM280.37mil as its next generation integrated glove manufacturing complex (NGC) started operations in Dedcember 2014.

“To date, there are eight production lines operating in the NGC, equivalent to an additional capacity of 2.9 billion pieces of gloves per annum,” it said.

Hartalega’s earnings per share were 7.07 sen compared with 6.63 sen. It also rewarded shareholders with a dividend of three sen a share compared with 3.5 sen a year ago.

For the financial year ended March 31, 2015, its earnings slipped to RM209.69mil from RM232.81mil a year ago. Its revenue increased to RM1.146bil from RM1.107bil.

Hartalega said operating profit margin was impacted by lower average selling price as a result of declining raw material costs and more competitive selling price. 

While its profit margin was impacted by the start-up cost of its NGC, Hartalega expected sales arising from the complex to mitigate this and contribute to the group’s profitability by the second quarter of FY2016.  

Hartalega’s managing director Kuan Mun Leong said market conditions continue to be demanding, particularly due to increased pressure from more competitive selling prices. 

“Despite the challenging environment, what is important is that we are a resilient group with a pole position in the nitrile glove manufacturing segment. Furthermore, global demand for nitrile gloves remains strong, which certainly bodes well for us,” he said.

Kuan said when the NGC comes fully on-stream, he expected it to significantly increase its production capacity and scale up its capabilities.