KUALA LUMPUR: Supermax Corp Bhd
posted a net profit of RM638.52mil in the first quarter ended Sept 30, 2021, a 19.12% drop from RM789.52mil in the previous corresponding quarter as profit margins slipped from a year ago.
"The margin regression is due to the fall in average selling prices (ASPs) as competition has intensified significantly following a period of substantial capacity expansion across the industry as both existing and new players ramped up their production capacities," it said in a bourse filing.
Earnings per share slipped to 24.6 sen from 30.58 sen in the first quarter of the previous financial year.
It declared a dividend of five sen per share going ex on Dec 3, 2021, and payable on Jan 3, 2022.
Meanwhile, the group's revenue rose 7.6% year-on-year (y-o-y) to RM1.46bil on continued strong demand for medical gloves and other personal protective equipment amid the global Covid-19 pandemic.
There was also higher sales during the quarter due to additional capacity generated by Supermax's newest plant, which was commissioned during the year.
On a quarter-on-quarter (q-o-q) basis, Supermax's revenue experienced a sharp 22.4% fall while Ebitda, pre-tax profit and profit after tax fell 24.0%, 24.4% and 34.4% respectively.
It said this was owing to the temporary closure of its entire manufacturing operations during the enhanced movement control order in July 2021 as well a restriction on the number of workers allowed under the National Recovery Plan.
Declining ASPs were also to blame for the lower q-o-q result due to intensifying competition along with rising glove supply.
"At the height of the global surge in demand, many new glove players had jumped onto the bandwagon. Many of the existing players also ramped up their capacities in large scale especially from players who are public-listed companies based in China, Malaysia and in Thailand.
"With the substantial increase in market supply, average selling prices have started declining with spot market prices currently much lower than contracted prices," it said.
The roll out of Covid-19 vaccines globally is also expected to cause some moderation in terms of glove demand and consumption although the company expects this to be gradual and not a sharp drop due to the structural change in consumption.
posted a net profit of RM638.52mil in the first quarter ended Sept 30, 2021, a 19.12% drop from RM789.52mil in the previous corresponding quarter as profit margins slipped from a year ago."The margin regression is due to the fall in average selling prices (ASPs) as competition has intensified significantly following a period of substantial capacity expansion across the industry as both existing and new players ramped up their production capacities," it said in a bourse filing.
Earnings per share slipped to 24.6 sen from 30.58 sen in the first quarter of the previous financial year.
It declared a dividend of five sen per share going ex on Dec 3, 2021, and payable on Jan 3, 2022.
Meanwhile, the group's revenue rose 7.6% year-on-year (y-o-y) to RM1.46bil on continued strong demand for medical gloves and other personal protective equipment amid the global Covid-19 pandemic.
There was also higher sales during the quarter due to additional capacity generated by Supermax's newest plant, which was commissioned during the year.
On a quarter-on-quarter (q-o-q) basis, Supermax's revenue experienced a sharp 22.4% fall while Ebitda, pre-tax profit and profit after tax fell 24.0%, 24.4% and 34.4% respectively.
It said this was owing to the temporary closure of its entire manufacturing operations during the enhanced movement control order in July 2021 as well a restriction on the number of workers allowed under the National Recovery Plan.
Declining ASPs were also to blame for the lower q-o-q result due to intensifying competition along with rising glove supply.
"At the height of the global surge in demand, many new glove players had jumped onto the bandwagon. Many of the existing players also ramped up their capacities in large scale especially from players who are public-listed companies based in China, Malaysia and in Thailand.
"With the substantial increase in market supply, average selling prices have started declining with spot market prices currently much lower than contracted prices," it said.
The roll out of Covid-19 vaccines globally is also expected to cause some moderation in terms of glove demand and consumption although the company expects this to be gradual and not a sharp drop due to the structural change in consumption.
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