Profit boost for Hartalega

Synthetic glove maker enjoys higher revenue and forex gain

PETALING JAYA: Hartalega Holdings Bhd ended its financial year on a high note, with a 30.4% growth in net profit to RM116.6mil for the fourth quarter (4Q) ended March 31, 2018, compared with RM89.4mil in the corresponding quarter last year.

The world’s largest synthetic glove manufacturer attributed its earnings growth to higher revenue and increase in net foreign exchange gain.

During the quarter in review, Hartalega’s revenue rose 17% to RM616.8mil from RM527mil in the previous corresponding quarter, while its earnings per share (EPS) increased to 3.53 sen from 2.72 sen previously.

Hartalega said its 4Q18 revenue growth was driven by “strong demand growth for nitrile gloves and continuous internal initiatives in improving production capacity which increased sales volume by

30.1%”.

The group declared a third interim dividend of two sen per share, bringing the total dividend declared year-to-date to seven sen per share.

For the full financial year (FY), Hartalega’s net profit grew 55.3% to RM439.4mil from RM283mil in FY17 in tandem with higher sales revenue, driven by increase in sales volume as a result of higher sales demand, additional production capacity and net foreign exchange gain.

During the year in review, the group’s revenue rose 32% to RM2.41bil from RM1.82bil in the preceding year, while the group’s EPS rose to 13.29 sen from 8.62 sen.

Hartalega said its revenue growth for FY18 was “due to higher sales volume of 32.5%, in line with the group’s continuous expansion in production capacity and growing demand for nitrile gloves”.

Hartalega managing director Kuan Mun Leong said the group’s strategic plans continued to bear fruit, enabling the company to deliver a strong performance on the back of increased sales volume, in tandem with its continuous expansion in production capacity and robust demand for nitrile gloves.

“As we move forward, we are well on track to meet growing global demand, driven by our Next Generation Integrated Glove Manufacturing Complex (NGC). To this end, we have successfully commissioned all 12 production lines in Plant 4 of the NGC,” Kuan said in a statement.

“We target to commence commissioning of Plant 5 in July 2018 and subsequently the construction of Plant 6. We are also planning to construct an additional Plant 7, which will focus on small orders and specialty products,” he added.

According to Kuan, Hartalega would launch its antimicrobial gloves in Europe on May 31.

“We are also currently in the process of securing approval from the Federal Drug Administration to enter the US market with this latest product,” he said.

Hartalega said prospects for the rubber glove manufacturing sector remained strong, with increasing demand arising from switching trends towards nitrile glove. It noted that nitrile glove now accounts for 60% of Malaysian rubber glove export.

As for the group’s prospects, Kuan said, “prospects are certainly bright for Hartalega and driven by our strategic expansion plans and product innovation, we are confident we will be able to propel the group forward in the coming year”.