KUALA LUMPUR (Oct 13): One Glove Group Bhd plans to undertake a capital reduction of RM120 million to eliminate accumulated losses of the glove manufacturing company.

The balance, if any, will be credited to a capital reserve account of the company, which will be used towards setting off future losses.

As at Thursday, One Glove had a total of 441.21 million shares in issue. In addition, it had 87.5 million irredeemable convertible preference shares (ICPS) held by BT Capital Sdn Bhd, and 71 million outstanding warrants 2023/2028 in the company (Warrants A).

In the minimum scenario, the firm will bring down its capital to RM80.52 million, from RM200.52 million, by cancelling the share capital, according to a bourse filing on Friday.

In the maximum scenario, the firm will bring down its capital to RM172.26 million, from RM200.52 million, by cancelling the share capital.

One Glove saw its net loss widen to RM12.12 million in the first financial quarter ended June 30, 2023 (1QFY2024), from RM7.83 million a year ago.

The proposed capital reduction will not have any material effect on the consolidated earnings and earnings per share of One Glove for FY2024.

The proposed exercise is subject to the approval of One Glove shareholders in an extraordinary general meeting to be convened.

Barring any unforeseen circumstances and subject to all required approvals being obtained, the proposed capital reduction is expected to be completed by the first quarter of 2024. UOB Kay Hian Securities (M) Sdn Bhd has been appointed as the adviser.

One Glove shares closed down half a sen or 2.33% at 21 sen on Friday, giving the company a market capitalisation of RM89.46 million.