Dipped Products 2Q net surge amid production increase

Dipped Products PLC, a leading nonmedical glove manufacturer controlled by Hayleys group saw its bottom line surging during the September quarter (2Q15), with production from its relocated factory in Biyagama kicking in.

Accordingly, the net profit for the quarter under review rose over 300 percent year-on-year (yoy) to Rs.295.3 million. The earnings per share improved to Rs.4.93 from Rs.1.16 reported during the same quarter of the previous year.

The revenue for the quarter rose 13 percent yoy to Rs.6.3 billion while cost of sales rose 12 percent yoy to Rs.5.28 billion, resulting in a gross profit of Rs.1 billion, up 20 percent yoy.

A 263 percent surge in the other income category to Rs.81.4 million was recorded during the quarter under review.

Distribution costs increased slightly by 3 percent yoy to Rs.160 million while the company was able to reduce its administrative costs by 4 percent yoy to Rs.475 million. The finance costs remained flat at Rs.84.5 million.

A segmental analysis showed that the hand protection business reporting a revenue of Rs.7.2 billion for the six months ended September 30, 2014 against Rs.6.9 billion recorded during the corresponding period of the previous year.

The segment reported a pre-tax profit of Rs.766.6 million up from previous year’s Rs.494.5 million.

The plantations segment reported a revenue of Rs.8.1 billion (for nine months due to the change of financial year of the plantation subsidiaries of Dipped Products) against Rs.5.4 billion in the previous year.

However, the segment’s pre-tax profit fell to Rs.273.4 million from previous year’s Rs.385 million.

“With the new facility, D. P. L. Premier Gloves Ltd in the Biyagama Export Processing Zone contributing to increased production output during the 2nd quarter, DPL was able to reduce order lead times and restore customer confidence,” a media statement by Dipped Products said.

“D .P. L. Premier Gloves will be adding more capacity for production of household gloves during the 2H which is expected to further boost sales growth of the company,” it added.

Furthermore, DPL has incorporated another subsidiary, namely D.P. L. Universal Gloves Ltd in August 2014. This entity will be focusing on the manufacture of industrial gloves.

The statement also noted that group’s overseas operations, Italian marketing company, ICOGUANTI S.p.A, continued its positive momentum in both turnover and profits.

“Dipped Products Thailand (DPTL) also made a positive contribution to group performance,” it noted.

Managing Director Dr. Ranasoma speaking on t he outlook for the rest of the financial year commented, “We are looking forward to taking our business to greater heights with the additional capacity coming in. The planned expansion programme at Premier Gloves and the capacity from Universal Gloves will help boost our global market share.”

Established in 1976, Dipped Products is one of the leading non-medical rubber glove manufacturers in the world, and accounts for a 5 percent share of the global market. The company’s products now reach 68 countries.