KUALA LUMPUR (June 16): In a bid to optimise cost structure, Top Glove Corp Bhd has laid off about 600 people of its total manpower under a mutual separation scheme (MSS), according to its executive director Ng Yong Lin.
The MSS took place in the March to May period and cut its workforce from 12,600 to 12,000 presently.
“We have been streamlining our workforce, transferring people from one department to other departments that are short of manpower. Recently, we have kickstarted the MSS and that affected about 600 people, or around 4% and 5% of the current workforce in the group. We will continue to study and see how to optimise our manpower [further],” Ng told a virtual press conference in conjunction with the release of Top Glove's results for its financial quarter ended May 31, 2023 (3QFY2023).
Apart from downsizing its manpower, the group has also been decommissioning obsolete production lines while temporarily stopping production at 17 out of its 49 factories, in light of the softer global glove demand post-pandemic, the group’s statement showed.
When asked if there were any impairment charges to be booked from the decommissioned production plants, managing director Lim Cheong Guan said the group has decided to write off the value of the plants affected.
“With the decommissioning, [we had] written off the value, which is minimal, I think it is less than RM2 million. If you look at our depreciation on plant and machinery, most [of their lifespan is] over 10 years, same as production lines,” Lim added.
The group reported earlier a narrower net loss of RM130.59 million for 3QFY2023, down from RM164.67 million in 2QFY2023, driven by higher average selling prices and its ongoing cost optimisation measures. Nevertheless, it was the group's fourth straight quarterly loss.
The improved quarterly performance was achieved despite revenue dropping 14.1% to RM530.62 million from RM618 million.
Shares of Top Glove settled down 11.5 sen or 10.55% to 97.5 sen on Friday (June 16), translating into a market capitalisation of RM8 billion.