KUALA LUMPUR (Aug 3): Hartalega Holdings Bhd posted a 928% surge in its net profit to RM2.26 billion for the first quarter ended June 30, 2021, from RM219.72 million in the previous years corresponding quarter amid higher average selling price (ASP) and sales.
Revenue for the quarter increased 324% to RM3.9 billion from RM920.09 million a year ago.
The group proposed a final single tier dividend of 19.75 sen per share, which is subject to the approval of its shareholders at the upcoming annual general meeting slated for Sept 7.
In its filing with the bourse, Hartalega said the higher sales revenue was mainly due to the increase in ASP and sales volume, while lower utilities expenses had contributed to the higher bottom line.
Going forward, the group said it will continue to expand its capacity in NGC, Sepang, adding that eight out of 10 lines in Plant 7 have been commissioned.
Upon full commissioning, it said Plant 7 will have an annual installed capacity of 2.7 billion pieces.
Meanwhile, NGC 1.5 another upcoming expansion is currently underway with the group targeting to commission the first line by December 2021.
NGC 1.5 expansion plans include four additional production plants which will contribute 19 billion pieces to the annual installed capacity. With the completion of NGC 1.5, the groups annual installed capacity will increase to 63 billion pieces per annum, said Hartalega.
The group said the delta variant of Covid-19 is driving surges of new infections worldwide, and therefore it expects demand for medical supplies, such as gloves, to remain elevated in the immediate term.
However, it acknowledged that ASPs for gloves have been declining from their peak towards the second half of the year.
In a separate statement, Hartalega chief executive officer Kuan Mun Leong said that moving forward, while ASPs for nitrile gloves have been declining from their peak, global demand is expected to remain heightened, particularly due to new waves of cases with Covid-19 variants affecting countries worldwide.
For the longer term, the structural step-up in demand in the glove sector will further spur demand growth, driven by increased glove usage from emerging markets with low glove consumption per capita and increased hygiene awareness, he said.
In the meantime, he said Hartalega will continue to enforce Covid-19 preventative measures in its operations to ensure no supply disruptions, adding that it has kick-started the immunisation programme for its employees.
At the time of writing, Hartalega shares fell 18 sen or 2.6% to RM6.85, giving a market capitalisation of RM23.48 billion.
KUALA LUMPUR (Aug 3): Hartalega Holdings Bhd posted a 928% surge in its net profit to RM2.26 billion for the first quarter ended June 30, 2021, from RM219.72 million in the previous year’s corresponding quarter amid higher average selling price (ASP) and sale…
