Hartalega CEO Kuan Mun Leong.
PETALING JAYA: The overcapacity situation in the glove sector persists and operating costs are rising amid intense competition, especially from China and other regional manufacturers, says Hartalega Holdings Bhd
chief executive officer Kuan Mun Leong.
“Ongoing uncertainty surrounding US tariff policies continues to weigh down on demand, especially in the US market, while also prompting a shift in long-term sourcing strategies among US importers,” he added in his review of the company’s first-quarter of financial 2026 (1Q26) results.
According to Kuan, the company’s 1Q26 performance reflects the ongoing recalibration taking place in the global sector.
Hartalega posted a net profit of RM12.61mil in the quarter under review, a sharp decline from RM31.93mil in the year-ago quarter for an earnings per share of 0.37 sen against 0.94 sen in the comparative quarter.
It said revenue was lower at RM553.11mil in 1Q26 as compared to RM583.84mil in 1Q25.
The group said the performance was impacted by a reduction in average selling prices (ASP) as well as lower sales volume, primarily owing to front-loaded inventories held by US customers and deferred orders in response to ongoing tariff developments.
At the same time, pricing pressures intensified in non-US markets, driven by excess supply from Chinese manufacturers. In addition, operating profit was affected by the lower ASPs, strengthening of the ringgit and less favourable cost absorption resulting from lower capacity utilisation.
Kuan said Hartalega was anchored by its long-term strategy, focusing on enhancing production efficiency and cost optimisation, investing in advanced automation, maintaining robust fiscal discipline, and sharpening its sales approach to strengthen its competitiveness and resilience.
“While near-term conditions are challenging, structural glove demand for rubber gloves continues to hold strong prospects, driven by growing global healthcare needs and hygiene awareness.
“Our focus remains on building long-term value while continuing to uphold best practices in responsible manufacturing and environmental, social and governance compliance.”
Separately, Hartalega said its wholly-owned subsidiary, Hartalega NGC Sdn Bhd, has received a Notice of Additional Assessments totalling RM101.36mil from the Inland Revenue Board (IRB) for the years of assessment from 2017 to 2022.
In a filing with Bursa Malaysia, the glovemaker said the assessments, dated Aug 4, 2025, comprised RM13.92mil for 2017, RM36.35mil for 2018, RM10,695 for 2019, RM32.89mil for 2020, RM18.10mil for 2021, and RM90,625 for 2022.
“The company is currently seeking legal advice and evaluating its legal options, which may include initiating a formal appeal to the IRB,” Hartalega said.
