Top Glove Corp Bhd managing director Lim Cheong Guan.
PETALING JAYA: Top Glove Corp Bhd
is confident it will return to the black in financial year 2025 (FY25) on the back of strong glove demand, better pricing, higher utilisation and reopening of closed factories as well as establishment of new factories.
According to managing director Lim Cheong Guan, the company is expected to benefit from the pause in new supply from China glove manufacturers for the next one to two years due to the impending tariff hikes imposed by the United States on medical glove imports from China.
Following the announcement, Lim said Top Glove has received about double the number of orders from US clients for both medical and non-medical gloves.
During its results briefing, Lim said despite all signs pointing towards a recovery, the weakening of the US dollar caused the company to remain in the red.
“Since the fourth quarter of FY23, quarterly losses have been steadily narrowing and sales volume was on an uptrend quarterly.
“But in an unexpected twist of fate, the US dollar weakened on the back of interest rate cuts, and our hopes of a turnaround in the fourth quarter did not materialise,” he explained.
Lim said it is looking forward to more orders as it has sufficient capacity to meet higher demands.
“Our capacity is recovering and 4Q24 is one of the best results we have achieved over the past eight quarters.
“So we look forward to the next two years and I believe we will do better in terms of sales revenue and profit,” he added.
Top Glove managed to trim its net loss to RM61.81mil in the financial year ended Aug 31, 2024 (FY24) from RM925.22mil in the previous year.
This improved performance of the group was on the back of 11.46% year-on-year (y-o-y) increase in revenue to RM2.52bil in FY24.
The glove maker’s net loss narrowed to RM3.57mil in 4Q24 compared with RM461.7mil a year ago while revenue jumped 75.5% to RM835.3mil against RM476.1mil.
“We are pleased that the group’s financial performance has improved significantly over the course of FY24, bringing us closer to breaking even.
“We are now on the final leg of our recovery journey and certain of turning profitable in FY25, as glove orders continue their uptrend.
“The group has every confidence in the long-term prospects for the glove industry which fundamentals are intact and robust, and we look forward to far better times ahead,” Lim said.
As the glove industry continues to recover, the group expects ongoing improvements in sales orders due to more positive demand and supply dynamics.
The installation of advanced production lines will be renewed at its new factories to ensure that it is well-positioned to meet the rapidly increasing demand for gloves – which had been temporarily halted due to an oversupply situation.Top Glove has proposed a bonus issue of up to 405.96 million warrants on the basis of one warrant for every 20 existing shares, subject to shareholders’ approval at the upcoming AGM in January.
