Language:

I am pleased to welcome you to the Top Glove website. This is an exciting time for our company and I hope this portal provides our multiple stakeholders with the opportunity to discover more about us and what we stand for. We also aim to ensure that information on our products, our financial performance and career opportunities with us is readily accessible.

A lot has changed since 1991, when we started the business as a local enterprise with 1 factory and 1 glove production line. Today, we have attained great success on a global level, emerging as the world’s largest manufacturer of gloves with 38 factories, 618 production lines and a production capacity of 57.5 billion pieces of gloves. We are also the preferred employer to a diverse workforce of 17,000.

There is no secret behind these achievements. What we have attained today has been founded on hard work and a focused pursuit of our Business Direction to produce consistently high-quality gloves at efficient low cost, which will continue to drive our business well into the future.

Indeed, we have come a long way from our modest beginnings but our growth trajectory is far from over. Top Glove is still a young dynamic company, and I believe that we can do even more, and do it better. Keeping the future in view, we are targeting to capture 30% of the world market by 2020. We are also keenly on the lookout for M&A opportunities and joint ventures, both in the glove business and other synergistic businesses as well.

On 4 April 2018, we completed the acquisition of Aspion Sdn Bhd, our largest acquisition to date, which will see Top Glove emerge the world’s largest surgical glove manufacturer, further solidifying our leadership position as the world’s largest manufacturer of gloves.  With this, we will be able to serve our global customer base more effectively, with a wider range of high quality and cost-effective gloves which include medical gloves, examination gloves and specialised surgical gloves.  Efforts to integrate our operations are well underway, and we look forward to working closely with our new colleagues to realise the immense strategic and financial benefits we are confident this exercise will give rise to.

Continuing to Deliver An Excellent Performance in 2QFY18

For 2QFY18, I am pleased to report that we delivered a very strong performance despite the shorter work months and headwind environment.

Sales Volume surged by an all-time high of 21% compared with 2QFY17 and 3% versus 1QFY18. The Group also achieved Sales Revenue of RM958.4 million, an increase of 12.6% year-on-year and 2.2% quarter-on-quarter. Profit Before Tax (PBT) came in at RM124.5 million, growing 21.2% in contrast with 2QFY17 and 2% versus 1QFY18, while the Group registered Profit After Tax (PAT) of RM110 million, up 32.2% and 3.9% against 2QFY17 and 1QFY18 respectively.

The upward trend continued on a 6 months comparison. For 1HFY18, Sales Volume improved by 19% versus 1HFY17. Sales Revenue amounted to RM1.9 billion, a 15.9% increase compared with 1HFY17. Meanwhile, PBT grew 28.1% to RM246.5 million and PAT soared 37.7% to RM215.9 million, compared with the corresponding periods in the previous financial year. The cumulative PAT for 1HFY18 was equivalent to 65.7% of the full year profit for FY17.

The significant growth in Sales Volume was mainly attributed to an increase in demand for natural rubber gloves, which we were able to meet owing to our balanced product mix, comprising both natural rubber and nitrile gloves. Demand growth for natural rubber gloves stemmed from emerging markets, where healthcare awareness and hygiene standards are rising steadily, particularly Asia (excluding Japan) and Eastern Europe which respectively saw a 60% and 40% boost in Sales Volume for 1HFY18 compared with 1HFY17. The Group’s performance also improved following a higher utilisation rate from stronger demand, an upward revision of the average selling price and additional natural rubber glove capacity from a factory which was acquired from A1 Glove Sdn Bhd in June 2017. However, this was offset by the marked increase in the gas tariff and other costs. Meanwhile, Top Glove’s focus on continuous improvement in quality and cost efficiency, which include Industry 4.0 initiatives, accounted for the improved profitability.

To support our ambitious growth agenda, we will continue to pursue strategic expansion via organic and non-organic routes. We are in the process of constructing 2 new manufacturing facilities namely, Factory 31 (operational by June 2018) and Factory 32 (operational by early 2019), which upon completion will boost the Group’s total number of production lines by an additional 78 lines and production capacity by 7.8 billion gloves per annum. Meanwhile, preparations for Top Glove's condom manufacturing facility have also commenced and it is expected to be operational by June 2018. Factoring in our Aspion acquisition, Top Glove is projected to have 34 glove factories, 693 glove production lines and a production capacity of 64.3 billion gloves per annum by December 2018.

We continue to progress well on our digital adoption journey as we embrace technological advancements, which will enable Top Glove to enhance product quality and operational efficiency. Additionally, we will also explore various measures to improve the dissemination of information to our customers and vendors towards a more integrated relationship.

It is not easy to do well in a challenging environment and we believe our commendable performance is largely credited to our commitment towards continuously improving the efficiency of our manufacturing operations. However, we will not be complacent and are preparing ourselves for an even more challenging second half of the financial year. We will continue to embark on quality improvement and cost-saving projects, while engaging with stakeholders to ensure we continue to deliver strong results in the quarters ahead.

TOP GLOVE, TOP QUALITY, TOP EFFICIENCY

GOOD HEALTH, SAFETY FIRST & BE HONEST

Tan Sri Dr Lim Wee Chai
April 2018