SUPERMAX'S PROFIT SOARS 2,815 PCT, BEST EVER 4Q PERFORMANCE

KUALA LUMPUR, Aug 10 -- Rubber glove producer, Supermax Corporation Bhd posted a net profit of RM525.58 million on the back of RM2.13 billion revenue in its fourth quarter for financial year ended (FYE) June 30, 2020, its best ever 4Q performance since incorporation.

In comparison, its net profit and revenue for 4Q2019 were RM123.11 million and 1.53 billion respectively.

In a filing with Bursa Malaysia today, it said its 4Q2020 revenue surged to RM929.1 million increasing by 147.1 per cent as compared to 4Q2019.

Net profit leapt to RM399.61 million from RM15.05 million while profit after tax soared by 2,815.4 per cent to RM408.3 million.

It said the demand for gloves as personal protective equipment had heightened as the world fights the COVID-19 pandemic.

“We are seeing the emergence of new consumers and new consumption not previously seen before prior to COVID-19. Currently, the group is in an oversold position. The surge in demand has resulted in a rapid rise of average selling prices (ASPs) since March 2020,” it said.

The group expects demand to remain buoyant in 2021.

Since the founding of Supermax, the group had adopted the Own Brand Manufacturing (OBM) model whereby it manufactures the products, package and market under its In-house brands.

“We currently export 55 per cent of production under our own brands via our own distribution centres and 40 per cent through independent distributors. 

“The remaining five per cent is for original equipment manufacturer (OEM) production. Due to the current robust demand, we are taking the opportunity to build new relationships with new customers and distributors in anticipation that they will continue with repeat orders post-pandemic,” said Supermax. 

The group’s products are sold to over 165 countries, the largest contributor being the Americas which contributed 51 per cent of revenue in FYE2020. 

“Asia/Oceania and Europe each contributed 23 per cent to FYE2020 revenue. In terms of product segmentation, 72 per cent is from nitrile powder free gloves, followed by 18 per cent from latex powder free and seven per cent and three per cent from powdered latex and surgical gloves, respectively.

In terms of capacity expansion, we plan to build five glove manufacturing plants between now and year 2022 with additional production capacity of 22.25 billion making a total of 48.42 billion gloves by end of year 2022,” it said.

Its capital expenditure investment for the new plants totals RM1.3 billion. 

“The highest ASPs have not been reflected this current quarter and we are optimistic that our OBM cum distribution business model will exhibit even healthier performance in the coming quarters,” Supermax added. 

-- BERNAMA