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 RUBEREX 7803 RUBBEREX CORPORATION (M) BERHAD posts net profit of RM2.0mil for Q2

Similar to other glove makers, the results were no surprise as the industry is presently facing intense competition amidst a severe and persistent over-supply of gloves in the market. NSTP/MUHAMMAD SULAIMAN

KUALA LUMPUR: Rubberex Corporation Bhd posted a net profit of RM2.0 million, backed by revenue of RM46.4 million for the second quarter (Q2) ended June 30, 2022.

Compared to the previous quarter, net profit had decreased by 23.1 per cent from RM2.6 million recorded in the first quarter (Q1) of 2022.

Cumulatively, the company achieved RM4.6 million in net profits for the first half of this year, a sharp decline of RM151.2 million or 97.0 per cent from last year.

Similar to other glove makers, the results were no surprise as the industry is presently facing intense competition amidst a severe and persistent over-supply of gloves in the market.

Group managing director Khoo Chin Leng said that as global vaccination rates improve over time and the usage of gloves becomes more mainstream, over-supply and declining average glove selling prices (ASP) are inevitable.

"While lower capacity utilisation and sales volumes were seen from our nitrile disposable glove division, demand for the company's other products, specifically our general-purpose and industrial gloves, remained stable and profitable," he said in a statement today.

Rubberex remains focused on its nitrile disposable glove division, where glove consumption is expected to stabilise in the long run.

Echoing the resilience of the healthcare industry, Khoo said that with significant improvements in health and safety standards worldwide, the company believes the demand for gloves will persevere.

Rubberex also released its circular seeking shareholders' approval for multiple proposals announced on May 31, 2022, on the acquisition of medical test kit manufacturer Reszon Diagnostics International Sdn Bhd, diversification into the healthcare business and subsequent change of name to Hextar Healthcare Bhd.

Rubberex's owner and sole largest shareholder, Datuk Eddie Ong Choo Meng, is supportive of the company's latest ventures and believes that the healthcare business will contribute significantly to the future growth and value of Rubberex.

While Eddie re-affirms his support and commitment to the company's core glove business, he said the move to diversify into a profitable business in a growing sector with huge potential is in line with Rubberex's long-term strategy of delivering sustainable growth and returns to shareholders.

https://www.nst.com.my/business/2022/08/825003/rubberex-posts-net-profit-rm20mil-q2

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