Supermax to benefit from weak Ringgit
KUALA LUMPUR: Glove maker Supermax Corporation Bhd
recorded a 42.7% jump in its earnings to RM27.90mil in the first quarter ended Sept 30, 2017 – boosted by improved efficiency and productivity – and it remained upbeat on global demand for both natural rubber and nitrile gloves.
It announced on Tuesday the earnings rose from RM19.53mil a year ago while earnings per share were 4.19 sen compared with 2.89 sen.
“Profitability has improved owing to efforts taken to improved efficiency and productivity, including the refurbishment of the older lines and streamlining of work processes,” it said.
In terms of profitability, the group recorded earnings before interest, tax, depreciation and amortisation (Ebitda) margins of 17.9% and profit before tax margins of 13%.
Revenue during the quarter rose 15.9% to RM312mil from RM269mil a year ago on higher output recorded from refurbishment done, higher average selling prices in response to increased raw material prices as well as a stronger US dolalr versus the ringgit.
“Global demand for both natural rubber and nitrile gloves remains strong with healthcare awareness continuing to rise, increasing regulation of the healthcare sector and ever higher healthcare spending in both the public and private sectors driving demand growth,” it said.
Supermax said these positive factors continue to augur well for the company and the industry as a whole.
It also pointed out the Chinese Government's concerted efforts to clamp down on the vinyl glove industry in China has also proven to be a boon for the natural rubber and nitrile glove producers as demand has shifted to them.
“The clamp down is due to the highly polluting nature of vinyl glove plants which do not comply with China's environmental regulations.
“In line with our continuous improvement efforts, we are refurbishing, rebuilding and modernising our older manufacturing plants to gain maximum efficiency in our production capabilities,” said Supermax.
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