PETALING JAYA: Top Glove Corp Bhd
, the world’s largest rubber glove manufacturer, believes its cost-control initiatives have lowered expenses to the extent that it is now on par and competitive with Chinese producers.
In fact, said group executive chairman Tan Sri Lim Wee Chai, Top Glove would hold an advantage when Chinese players utilise the “China + 1” strategy and move to manufacture overseas such as in Asean, estimating that the group’s costs would be 10% lower than those of its competitors.
Commenting that in the past two to three years, Top Glove’s average selling price (ASP) was roughly 20% higher than its Chinese counterparts, but more efficient cost management by the group has successfully brought down selling prices and tightened its competitiveness.
Wee Chai was speaking at the press conference of the group’s latest quarterly results for the three months ended Nov 30 (1Q26), as he was joined by Top Glove’s managing director Lim Cheong Guan, executive director Ng Yong Lin and marketing director Lim Jin Feng.
Top Glove saw net profit in 1Q26 surge by more than seven times year-on-year (y-o-y) to RM38.6mil, even as revenue stayed flat at RM883.6mil, with Cheong Guan noting that the latest results signalled a persistent positive momentum that was carried over from the preceding six months.
“Sales volume grew a healthy 70% y-o-y and 4% quarter-on-quarter (q-o-q), which reflected a lower ASP in line with easing raw material costs and the impact of a stronger ringgit,” he said.
Echoing Wee Chai’s earlier comment on reducing costs, Cheong Guan said this had helped cushion currency headwinds and supported Top Glove’s profitability, which was also underpinned by more focused marketing strategies and high plant utilisation rates that had reached 73% in 1Q26.
He added: “This has enhanced our production efficiency.”
Delving deeper into the numbers, Cheong Guan said sales volume for natural rubber gloves had increased 9% q-o-q, extending a strong momentum built up from 3Q25, while ASP declined by 3%.
He reported that cost per carton of natural rubber gloves also improved by 4%, driven by higher utilisation and an 11% decline in natural latex price since 3Q25.
“For nitrile gloves, sales volume was flat q-o-q in 1Q26 following a positive 10% in 4Q25, although encouragingly, order momentum has picked up in 2Q26. In response, we are increasing our running capacity by reopening additional factories to meet the rising demand.
“As nitrile latex prices have declined by 4% in 1Q26 and by 14% over the past six months, we are retaining part of this cost saving to improve profitability and to offset the impact of a weaker dollar,” he said.
Elaborating about the group’s q-o-q sales figures, which grew 4% in 1Q26, Cheong Guan acknowledged that Top Glove is aiming to further improve, noting that the only “constraint” could be the group’s manufacturing capacity, which is currently at 75% overall, churning out 65 billion pieces of gloves per annum.
“With the reopening of these additional factories and lines, we are hoping to better cater to this increasing volume, as our customers are already replenishing their depleting stock. Therefore, in the coming quarters, we should see even better improvement in our sales volume,” he said.
North America makes up approximately 33% of Top Glove’s sales volume, with Asia also comprising another 25%, and Europe (Eastern and Western) combining to make up another 25%.
Of interest, Top Glove’s revenue and net profit were almost identical to that from 4Q25, as net profit remained practically unchanged, even though turnover dipped fractionally from RM889.6mil.
Notably, while commenting that the rubber glove industry remains extremely competitive and that the group has to keep doing its best with its product quality and cost management, Wee Chai revealed that operating environment has markedly improved, as increasing orders of up to 1.4 billion pieces weekly means Top Glove has had to extend delivery time from 30 days to 60 days.
“It is looking much better now than three years ago. However, there is still much to improve on relative to the scale that we were operating at during the lockdowns, which we aim to return to either in the financial year ending August 2026 (FY26) or FY27,” he said.
Separately, with Top Glove having declared a dividend of 0.48 sen per share at the end of FY25, representing a dividend payout ratio of 37%, Cheong Guan said the group is keeping to its dividend payout ratio of 50%, especially as demand momentum sustains along with the group’s profitability.
“With the improvement in our production lines, profitability and cash position, there will be more opportunities for us to increase the payout ratio, and move it closer to our intended target of 50%,” he pointed out.
Meanwhile, Top Glove said in a filing with Bursa Malaysia that prospects for the glove industry remain promising, as gloves continue to be an essential item across healthcare and multiple other sectors.
The group is expecting glove demand to continue growing across key geographies, supported by steady replenishment cycles and new opportunities.
“Consistent foreign-exchange hedging and prudent financial management will further strengthen the group’s resilience, positioning it well to sustain its upward momentum and deliver long-term value,” it said.
