Latest news with #RM70.5mil
The Star
26-06-2025
- Business
- The Star
Top Glove expects more orders after tariffs clarity
Top Glove managing director Lim Cheong Guan. PETALING JAYA: Top Glove Corp Bhd is banking on clearer US tariff policies and improving plant utilisation rates to support its earnings recovery, even as average selling prices (ASPs) remain under pressure amid stiff market competition and volatility in raw material cost. Top Glove managing director Lim Cheong Guan said market uncertainties and increased competition led to a downward adjustment in ASPs for nitrile and natural rubber gloves by 5% and 3%, respectively, in the third quarter of financial year ended May 31, 2025 (3Q25). The price adjustments were made in response to declining raw material costs to enable cost past-through and maintain price competitiveness. 'The third quarter was marked by uncertainty and competition stemming from the tariff developments. On April 1 when the tariff was announced, it resulted in temporary order deferrals and cancellations by some US customers who had not anticipated the added cost. This negatively impacted sales volume in the month of April. 'However, following the tariff revision to 10%, strong order inflows from the United States resumed, driving a strong 24% quarter-on-quarter sales volume growth to the United States market. 'On the other hand, competition intensified in Europe as Chinese manufacturers facing restricted access to the United States market shifted their focus there,' he said in a virtual result briefing for 3Q25 yesterday. For 3Q25, Top Glove saw a 31% drop in net profit year-on-year (y-o-y) to RM34.7mil or earnings per share of 0.43 sen. Revenue on the other hand rose by 30% y-o-y to RM830.3mil. For the nine month period of financial year ended May 31, 2025 (9M25), the group's net profit was up y-o-y to RM70.5mil from a loss of RM58.2mil previously. The company recorded a 55% increase y-o-y in revenue for 9M25 to RM2.6bil. On a quarter-on-quarter basis, sales volume increased by 4% despite a 6% decline in revenue due to lower ASPs and a weaker US dollar. Cheong Guan added the slight decline in ASPs also reflects falling raw material costs where nitrile and natural rubber prices are expected to decline by close to 14%. He also anticipates more orders to flow in once there is more clarity of the tariff policy. 'During this period, we do share some of these cost savings with our customers as well. 'However, we also believe that once the tariff policies are finalised, our customers will be able to place orders with more certainty, without worrying that the tariff rate might go up to say 20%, which would result in higher import costs compared with 10% right now,' he said.
The Star
26-06-2025
- Business
- The Star
Top Glove's 3Q earnings slip amid headwinds
KUALA LUMPUR: A volatile market and uncertain trade environment chipped away at Top Glove Corp Bhd 's earnings in the third quarter ended May 31, 2025, despite a jump in revenue on a year-on-year comparison. "Our 3QFY2025 performance was impacted by pronounced headwinds, chiefly lower average selling prices, heightened competition, coupled with cost savings pass through. "However, it is encouraging that we have remained profitable while successfully delivering volume growth," said managing director Lim Cheong Guan in a statement announcing the glovemaker's quarterly result. According to the stock exchange filing, Top Glove posted a net profit of RM34.75mil, which was down from RM50.67mil in the year-ago quarter, attributed to increased competition and the weakening of the US$ against the ringgit. Top Glove had also registered a higher gain from land disposals in the year-ago quarter, which was absent in the current quarter. In line with the lower bottomline, earnings per share dipped to 0.43 sen from 0.63 sen previously. Revenue, however, rose to RM830.25mil from RM636.88mil, driven by a 45% increase in sales volume. For the cumulative nine-month period, the group's net profit was RM70.5mil, which compared favourably to a net loss of RM58.24mil in the year-ago period, while revenue rose to RM2.6bil from RM1.68bil in the comparative period. 'We believe the long-term outlook is still promising as gloves are an essential item across multiple sectors, which will drive sustained global demand. "We are also committed to delivering value to our stakeholders, while staying true to our principles of responsible and sustainable growth. These will enable us to navigate a volatile landscape while capitalising on emerging opportunities," said Lim.
The Star
03-06-2025
- Business
- The Star
Kawan Food's revenue forecast to remain stable
PETALING JAYA: BIMB Research expects Kawan Food Bhd 's revenue to remain stable over the long-term with growth likely to be driven by strong demand for convenient, high-quality frozen food, particularly in key international markets. This will be supported by ongoing product innovation and improved distribution efforts, the research house said in a note to clients. Meanwhile, the group will continue to focus on strengthening its supply-chain resilience and broadening its product offerings. Despite short-term external headwinds, demand remains healthy, as reflected in the group's steady revenue from Malaysia and key export markets, the research house said. However, BIMB Research added that Kawan Food remains cautious given ongoing global volatility from geopolitical tensions and currency fluctuations. On the group's results for the first quarter of this year (1Q25) , the research house said Kawan Food's earnings came below its expectations, with core profit after tax and minority interest of RM4.3mil, which accounts for only 11% of the full-year forecast. Revenue declined by 12.6% year-on-year to RM70.5mil, primarily due to softer demand from export markets with Europe down 25.2% and North America down 52.8%. As a result BIMB Research cut Kawan Food's FY25 and FY26 earnings assumption by 13% and 8% to RM34.4il and RM41.3mil, respectively, to account lower revenue from the export market. It maintained a 'buy' call on the stock with a lower target price of RM1.70 from RM2 earlier.
