I am pleased to welcome you to the Top Glove website. This is an exciting time for our company and I hope this portal provides our multiple stakeholders with the opportunity to discover more about us and what we stand for. We also aim to ensure that information on our products, our financial performance and career opportunities with us is readily accessible.
This 2016, Top Glove celebrates its 25th anniversary. A lot has changed since 1991, when we started the business as a local enterprise with 1 factory and 3 production lines. Today, we have attained great success on a global level, emerging as the world’s largest rubber glove manufacturer with 28 factories, 500 production lines and a production capacity of 46.6 billion. We are also the preferred employer to a diverse workforce of 10,000.
There is no secret behind these achievements. What we have today has been founded on hard work and a focused pursuit of our Business Direction to produce high quality gloves with efficient low cost, which will continue to drive our business well into the future.
Indeed, we have come a long way from our modest beginnings but our growth trajectory is far from over. Top Glove is still a young dynamic company, and I believe that we can do even more, and do it better. Keeping the future in view, we are targeting to capture 30% of the world market by 2020. We are also keenly on the lookout for M&A opportunities, not only in the glove business but other synergistic businesses as well. Becoming the world’s largest nitrile glove manufacturer is also high on our corporate agenda.
We are pleased to have commenced our financial year 2017 on a positive note.
For 1QFY17, the Group delivered Profit Before Tax (PBT) of RM89.8 million, 19.1% higher compared with 4QFY16, and Profit After Tax of RM73.6 million, representing a 11.9% growth against the same quarter. Sales Revenue was also on the uptrend, increasing 8.8% to RM785.6 million, while Sales Volume (quantity sold) rose 5% quarter-on-quarter, in spite of a challenging business environment.
We were able to deliver a good performance despite increases in the natural gas tariff and minimum wage, because of internal enhancements which continue to be implemented throughout the glove manufacturing process. These ongoing improvement initiatives have enabled us to produce better quality gloves at a more efficient cost, in line with Top Glove’s Business Direction. The strengthening of the US Dollar towards the end of the quarter in review, also contributed to the Group’s results.
Our year-on-year results were softer, as Profit Before Tax and Sales Revenue eased by 44.3% and 1.8% respectively, comparing less favourably with 1QFY16, during which there was a marked strengthening of the US Dollar, higher average selling prices coupled with lower raw material prices. We also felt the full impact of the 24% hike in the natural gas tariff and 11% increase in minimum wage, which was not present in 1QFY16. However, Sales Volume still registered an increase of 7% versus the corresponding period in FY16.
As at 30 November 2016, the Group maintained a positive net cash position of RM259.5 million and a healthy balance sheet.
Looking ahead, we anticipate a challenging business terrain, characterised by change and uncertainty. While oversupply is tapering off, competition will continue to intensify as major players increase their nitrile glove production capacity.
Nonetheless, the outlook for our industry remains positive as gloves represent an essential item in the healthcare sector and account for only a fraction of medical costs. Hence, demand is generally resilient to economic and political uncertainty, and projected to grow at 6% to 8% yearly.
Having started FY2017 on a firm note and set the tone for a good year ahead, we will keep looking for areas in which we can do better and respond faster, so we can continue delivering a strong performance in the coming quarters.
Tan Sri Dr Lim Wee Chai
Chairman’s Welcome Message
Written by Administrator