KUALA LUMPUR (Nov 23): Hextar Healthcare Bhd posted a net loss of RM4.37 million for the third quarter ended Sept 30, 2022 (3Q22), compared to a net profit of RM25.22 million last year (3Q21), due to the persistent easing of average selling prices (ASP) for nitrile disposable gloves.

The company, formerly known as Rubberex Corporation (M) Bhd, said its revenue dropped 62.16% to RM35.9 million in 3Q22 from RM94.9 million in 3Q21. Earnings per share fell to -0.51 sen from 2.98 sen, it reported in a bourse filing on Wednesday (Nov 23).

“Continuous easing of ASPs and low-capacity utilisation due to oversupply of nitrile disposable gloves in the market impacted adversely on this division. However, it was mitigated by the resilience and stability of the group’s other products, specifically in the household and industrial gloves division,” Hextar Healthcare said.

For the cumulative nine months ended Sept 30, Hextar’s net profit recorded a significant decline of 99.86% to RM239,000 in 3Q22 from RM176.4 million a year ago. Meanwhile, its revenue sank 69.8% to RM135 million from RM447 million in the same period.

“We foresee the unrelenting softening of glove ASPs, specifically in our nitrile disposable glove division, to persist well into the first half of 2023,” Hextar Healthcare managing director Khoo Chin Leng said in a separate statement on Wednesday.

He also indicated that the group remains focused on its nitrile disposable glove division with the expectation that glove consumption will stabilise in the long run amidst heightened safety and hygiene awareness globally in the post-pandemic period.

“With significant improvements seen in health and safety standards worldwide, we believe the demand for gloves will persist,” Khoo added.

Besides that, the management said it is also mindful of competition and operational risks such as foreign exchange fluctuations, supply chain disruptions, material and labour costs that could impact on its financial results.

The Perak-based company had earlier announced the completion exercise of its acquisition of IVD medical device manufacturer, Reszon Diagnostics International Sdn Bhd, and diversification into the healthcare sector.

On Wednesday, the group reiterated that the venture will contribute progressively to the future growth of Hextar Healthcare.

Hextar Healthcare is an investment holding company whilst its subsidiaries are mainly involved in the manufacturing and sales of household gloves, industrial gloves and nitrile disposable gloves.

According to the group, the European continent is its largest customer base. Hextar Healthcare also operates an overseas marketing office in Spain called Rubberex Spain S.L.

The share price of Hextar Healthcare decreased one sen or 2.47% to 39.5 sen on Wednesday, valuing the group at RM431.81 million.