Higher sales, forex gains boost Hartalega profits

By TMR

Hartalega Holdings Bhd posted a net profit of RM113 million for the final three months (4Q) of 2017, almost double than the RM66.2 million recorded for the same period a year ago, boosted by higher sales, lower operating costs and foreign-exchange (forex) gains.

The glove maker’s revenue for the October-December 2017 period rose to RM603 million from RM456 million in 2016.

Profit before tax (PBT) jumped to RM138.8 million in 4Q of 2017 compared to RM78.2 million in 2016.

The company told Bursa Malaysia that the higher PBT is consistent with higher revenue achieved, in line with higher sales demand, and improvement in production capacity and lower costs incurred from improvement in operational efficiencies.

Hartalega said the glove maker also benefitted from net forex gain.

The group’s revenue for the whole of 2017 increased by RM493.7 million, or 38.1%, to RM1.78 billion compared to RM1.29 billion in 2016.

“The significant increase in revenue is in line with the group’s continuous expansion in production capacity and increase in demand from customer,” Hartalega said.

Sales volume also increased by 33.5% and higher average selling price contributed to the increase in revenue, the company said.

“The rubber glove manufacturing sector remains strong with increasing demand arising from switching trends towards nitrile glove,” the company said, adding that nitrile glove accounts for 61% of Malaysian rubber glove export.

“Moving into 2018, the demand for gloves will remain robust as Chinese vinyl glove producers still face difficulties conforming to strict environmental laws under China’s anti-pollution drive,” it said.

Hartalega’s Next Generation Integrated Glove Manufacturing Complex is scheduled to meet this rising demand with progressive commissioning of Plant 4 and the ongoing construction of Plant 5.