According to Kuan Mun Leong, CEO of Hartalega Holdings Bhd, the excess in the glove market has somewhat decreased as a result of capacity reductions at major local manufacturers and the withdrawal of some smaller competitors.
However, Kuan anticipates that the industry’s challenges would continue in the second half of the fiscal year as a result of the persistent global oversupply and fierce competition that have driven down average selling prices (ASP).
Hartalega reported a net profit of RM27.7 million for the quarter that ended on September 30, 2023, matching the net profit of RM28.34 million for the same period the year before.
Earnings per share for the group were 0.81 sen as opposed to 0.83 sen earlier.
Due to lower sales volume and ASPs, revenue decreased to RM452.09 million from RM584.56 million in the prior quarter.
In the six months ending September 30, 2023, Hartalega reported a net loss of RM24.77 million, down from a net profit of RM116.62 million in the prior comparative period. As sales volumes and ASP fell, revenue decreased to RM892.12 million from RM1.43 billion.
According to Kuan’s statement announcing the group’s results, the group would have recorded a pre-tax profit of RM38 million for its first half of FY24, as opposed to RM171 million in the same period last year, if not for the one-time provision for severance pay of RM47 million for the decommissioning of its Bestari Jaya facility, which was recognized in the first quarter of FY24.
When it is finished by the first quarter of 2024, he said, the group’s Next Generation Integrated Glove Manufacturing Complex (NGC) in Sepang would have consolidated activities from its Bestari Jaya site, leading to enhanced operational and economic efficiencies.
In addition, we’re still committed to implementing automation, increasing ongoing operational efficiency, and practicing responsible cost management.
In order for us to continue leading the industry and guarantee the group’s sustainable growth, we must advance our environmental, social, and governance (ESG) agenda, according to Kuan.