Comfort Gloves earnings soar on higher sales, ASPs
PETALING JAYA: Comfort Gloves Bhd’s net profit soared in the first quarter ended April 30, 2021 to RM219.13mil, 13 times more than the amount it earned in the same quarter last year, thanks to higher sales and a significant jump in average selling price prices (ASPs).
The group also attributed the growth in its bottom line to better economies of scale in its production that has improved its margin from 11% to 40%.
In a filing with Bursa Malaysia, Comfort said it posted a 245% jump in revenue to RM541.24mil from RM152.91mil a year earlier.
Comfort declared an interim dividend of four sen that will be paid on July 22.
Yesterday, shares in Comfort closed six sen or 2.9% higher to RM2.15 apiece.
For the quarter under review, its earnings per share (EPS) jumped to 37.75 sen from 2.8 sen, while net asset per share stood at RM1.32.
On a quarterly basis, Comfort’s net profit surged 59% from RM137.87mil in the fourth quarter ended Jan 31, 2021.
The group said it expected global glove consumption to increase in the long run as a result of the continuing usage of gloves as a protective barrier in the healthcare sector; and higher hygiene awareness in the non-healthcare sectors such as hospitality, food services and personal care since the outbreak of the Covid-19 pandemic.
“In view of the positive outlook of the gloves industry as set out above, Comfort intends to capitalise on this opportunity to develop a steady customer base.
“The group believes that barring any unforeseen circumstances, its prospects should be positive, moving forward,” it said.
In line with its glove consumption expectation, Comfort is targeting to commission four double-formers dipping lines in this quarter, and planning to commission additional seven double-formers dipping lines by the end of the financial year ended Jan 31, 2022.
“With all the completed production facilities, the group will be capable of producing up to 8.6 billion gloves per annum.
“The group has a better competitive advantage as we differentiate ourselves by producing natural and synthetic premium speciality gloves.
“Our machine lines are designed in such a way that it can produce both latex and nitrile gloves, regardless of speciality or medical gloves,” it said.
In a separate filing, Comfort said its board had resolved to withdraw the resolutions on the proposed allocation of awards under its employees’ share scheme to the group’s executive chairman Datuk Lau Eng Guang and his son Brian Lau Joo Kien from being tabled for shareholders’ approval in the company’s AGM today.
The group said it had received a letter of withdrawal from the two of them.