Supermax’s 2Q earnings slide 21% on lower selling prices

By NUR HANANI AZMAN 

SUPERMAX Corp Bhd’s earnings slid 20.9% to RM30.17 million for the second quarter ended Dec 31, 2019 (2Q20), from RM38.14 million a year earlier, mainly due to lower average selling prices and higher production costs.

Earnings per share for the quarter were lower at 2.31 sen against 2.91 sen in 2Q19, the group told the local bourse yesterday.

Revenue stood at RM385.5 million for the quarter, a 0.1% increase from RM385.1 million the year prior, attributed to global sales of the group’s natural rubber and nitrile rubber gloves.

The glove maker said demand for Malaysian-made gloves started to pick up towards the end of last year, as US buyers began diverting orders to non-China glove producers as a result of the ongoing US-China trade spat.

“Going into 2020, glove demand receives a further boost following the outbreak of the Covid-19 in China. Orders for gloves have been on the rise from China and other countries in the region as the need to prevent cross-contamination between infected persons and medical personnel becomes more apparent,” it said.

The company is expediting the commissioning of the new lines at its latest manufacturing plant in efforts to contribute more towards the fight against the outbreak.

Towards end-2019, the glove producer completed the acquisition of land in Meru, Klang, on which it plans to build three new plants that will contribute another 13.2 billion pieces of gloves to the group’s installed capacity over the next five years.

For its contact lens business, the group will continue to work on securing licences and approvals for more products in more countries, while further expanding its product range to include other types of lenses and increasing market penetration for its products globally.