KUALA LUMPUR (June 19): Top Glove Corp Bhd (KL: TOPGLOV) has returned to the black after seven consecutive quarters of losses thanks mostly to land sale and currency gain.
Net profit for the third financial quarter ended May 31, 2024 (3QFY2024) totalled RM50.67 million against a net loss of RM130.59 million in the previous year's corresponding quarter, its exchange filing on Wednesday showed. The company booked RM54.34 million from disposal property, plant and equipment, as well as RM22.33 million from unrealized foreign exchange gain.
Quarterly revenue rose 20% to RM636.88 million from RM530.62 million previously, as the growing glove demand enabled the group to share out some of the cost increases with customers through upward revisions in average selling prices (ASPs).
"We are pleased to have seen a return to black this quarter as the glove industry turns a corner. This is largely attributed to improving glove demand as customers’ orders resume, alongside intensive efforts to level up our quality and cost efficiency, as well as gains from the sale of excess land," Top Glove managing director Lim Cheong Guan said in a separate statement.
Supported by improvements in its performance from quarter to quarter, Top Glove remains optimistic about industry prospects. Looking ahead, Top Glove anticipates amplified business opportunities in the US market following the impending imposition of steeply increased tariffs by the US government on medical gloves from China.
"Customers from the US are expected to start moving away from outsourcing orders to China ahead of year 2026 when tariffs take effect, and Top Glove as a major glove exporter to the US is optimally positioned to capture more market share from the potential trade diversion," the glovemaker said.
For the first nine months of financial year 2024 (9MFY2024), Top Glove was still in the red with a net loss of RM58.24 million, albeit an improvement of 87.4% compared with a net loss of RM463.49 million recorded in the previous year's corresponding period. However, revenue slipped 5.6% to RM1.68 billion from RM1.78 billion previously.
The world’s largest glovemaker by volume did not declare any dividend for the quarter.