KUALA LUMPUR: Comfort Gloves Bhd posted its highest ever quarterly net profit of RM219.13mil in the first quarter ended April 30, 2021 due to higher sales volume with significant higher average selling price and better economies of scale.
In its statement on Monday, it said the earnings surged 1, 241% from RM16.34mil a year ago as these factors helped its margin improve from 11% to 40%.
Comfort Gloves’ revenue for the quarter rose by 254% to RM541.24mil from RM152.91mil a year ago. Earnings per share were 37.75 sen compared with 2.8 sen. It declared an interim dividend of five sen a share.
When compared with the preceding quarter ended Dec 31, 2021, it said sales revenue increased by 70% from RM318.90mil.
The profit after tax increased by 59% to RM219.13mil from RM137.87mil boosted by higher sales volume and average selling price.
The drop in profit margin to 40% from 43% was mainly due to provision of incentive payable to all level of staff as a recognition of their contribution towards the company.
On its current year prospects, it said there are are four double formers dipping lines completely commissioned in this quarter.
“We plan to commission additional seven double formers dipping lines which expected to be completed towards the end of financial year ended Jan 31, 2022.
“With all the completed production facility, the group will be capable of producing up to 8.6 billion gloves per annum.
“The group has better competitive advantage as we differentiate ourselves by producing natural and synthetic premium specialty gloves, ” it said.
Comfort Gloves said its machine lines can produce both latex and nitrile gloves, regardless of specialty or medical gloves.
It added the interchangeability of the line enables it to switch production base upon demand dynamics especially there is shortage in supply of natural or synthetic latex.
“Hence, even without Covid-19, the flexibility of our manufacturing process and customer base outside the medical market has allowed us to effectively expand our market base for specialised industrial use, ” it said.
Comfort Gloves expects global gloves consumption to increase in the long run as a result of the continuing increase in usage of gloves as a protective barrier in the healthcare sector; and the increase in hygiene awareness in non-healthcare sectors such as hospitality, food services and personal care since the outbreak of Covid-19 pandemic, ” it said.