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Dear Valued Stakeholders,

Welcome and thank you for visiting the Top Glove website. We invite you to explore this portal to learn more about what we have to offer you.

The Top Glove journey began in 1991 as a local enterprise with only 1 factory, 1 glove production line and 100 employees. Today, we have transformed into an international business attaining 26% of the world market share for rubber gloves with production bases in Malaysia, China, Thailand and marketing offices in these countries as well as Germany, USA and Brazil. As the world’s largest glove manufacturer, we presently have 43 factories, 687 production lines and a production capacity of 70.5 billion pieces of gloves per annum.

Only 29 years of age in 2020, we remain a young and dynamic company with a Vision to be your world class partner in gloves and healthcare products. Our continued focus on innovation, digitalisation and improvements in our production processes and services continue to bear fruit as we deliver an impressive performance year after year. Our CAGR for revenue and profit are 21.7% and 19% respectively, while our shareholder return since 2001 is 7,461% (as at 16 December 2019). More detailed reports on our financial performance can be found here: https://www.topglove.com/ir-home/

Prospects for both Top Glove and the glove industry continue to remain promising. The global demand for gloves is growing steadily, both in emerging and developed regions, driven by strong market fundamentals. Accordingly, Top Glove’s aim is to continue expanding our operations to ensure we are positioned to cater to the robust demand which is set to grow at 10% to 12% per annum. For this, we are consistently on the lookout for M&A opportunities with good valuations as well as diversification exercises to expand our product range.

Additionally, at Top Glove, we believe sustainability cannot be separated from business and continues to rank high on our corporate agenda. In demonstration of our commitment, we established a Board Sustainability Committee, entrusted with driving efforts and enabling us to make meaningful strides in this increasingly important space. We continue to step up our endeavours, particularly in terms of creating a safe and healthy work environment, over and above requirements of local labour laws. Learn more about our sustainability initiatives here: https://www.topglove.com/sustainability/

Our milestones could have only been accomplished with the help of our 18,000 strong workforce. Our employees play an integral part in managing our business well and we are ever grateful to be working alongside our committed people, who daily show us what can be attained through the power of teamwork.

In all we do, we are guided by our core values which include foremost, working based on our Business Ethics of Honesty, Integrity and Transparency and bonded by our Corporate ValuesRespect, Integrity, Value, Empowerment and Relationship, represented by the acronym RIVER, which serves to guide us in our pursuit of an ambitious business agenda whilst instilling a healthy and inclusive culture conducive for growth. We believe that health truly is wealth, to which end we practise Top Glove’s 5 Quality Wells Clean Well, Eat Well, Work Well, Exercise Well and Sleep Well daily, so we remain fit and well-positioned to contribute positively and compete effectively. This will enable us to live out our motto "Work is our hobby, Exercise is our duty, Health is Wealth".

Our journey towards excellence doesn’t stop here. In fact, it has only just begun. We have set our sights even higher going forward. We aim to capture 30% of the world market by year end 2020 and to ultimately become a Fortune Global 500 company by 2040. These may be ambitious, but we do not set goals which are easy to attain; we set goals which are good for our business and good for our people. While the road towards success may be challenging, we believe that as we continue to work harder, faster and smarter with integrity and leveraging on advanced technologies, we will be able to overcome challenges and continue delivering the performance you have come to expect of Top Glove.

A Strong Start to FY2020 for Top Glove

We are pleased to report that Top Glove started Financial Year 2020 with a 51% surge in Net Profit quarter-on-quarter underpinned by better contributions from both the nitrile glove and natural rubber glove segments.

For 1QFY20, the Group achieved Sales Revenue of RM1.21 billion, up 1.7% quarter-on-quarter. Its profit figures were solid, with Profit Before Tax surging 70% to RM125.5 million and Profit After Tax rising 51.1% to RM111.8 million, compared with the preceding quarter. Meanwhile, Sales Volume (Quantity Sold) growth was a healthy 6% versus 4QFY19.

Year-on-year Sales Revenue was softer by 4.2%, while Profit After Tax and Sales Volume improved slightly by 0.1% and 0.2% respectively against 1QFY19, during which the Group had benefited from tailwinds coupled with lower raw material prices.

Our commendable profit was mainly attributed to a strong performance in the nitrile glove segment, which saw Sales Volume growth of 12% versus 4QFY19. This was largely the result of ongoing technological advancements, as well as automation and digitalisation initiatives, which led to higher levels of efficiency and quality control, thereby enabling the Group to increase its sales and profitability. Meanwhile, increased nitrile capacity from ongoing organic expansion allowed the Group to further grow sales, cater to larger customers and capture a bigger market share in US, Western Europe and Japan.

In addition, Top Glove’s Thailand operations contributed positively to our good performance, while we continued to see recovery in our China operations, which improved due to better ASPs for vinyl gloves. Aspion’s positive profit position also contributed to the Group’s bottom line.

In tandem with strong glove demand which is estimated to grow at 10% to 12% yearly, we will continue to embark on organic expansion. In progress is the expansion of several existing and new facilities, which will boost the Group’s total number of production lines by an additional 178 lines and production capacity by 21.3 billion gloves per annum. By December 2021, Top Glove is projected to have a total of 861 production lines and a production capacity of 91.4 billion gloves per annum.

We will continue to invest in existing line refurbishment and building new technologically advanced glove factories. The Group’s newer factories will feature more automation and digitalisation initiatives, such as an Automated Guided Vehicle (AGV) transport and warehouse management system, production SCADA system, glove auto packing system, artificial intelligence vision camera system for online detection and removal of defective gloves, as well as auto compounding and chemical preparation. We will also continue to explore M&As and JVs, while diversifying into rubber or healthcare-related businesses.

Reflecting the importance of R&D and innovation at Top Glove, plans are in progress to establish a Manufacturing and Research Centre of Excellence, the Group’s new state-of-the-art hub for R&D and product innovation embracing Industry Revolution 4.0 initiatives, based in Banting, Malaysia.

As a socially responsible employer and industry leader, Top Glove is committed to upholding fair labour practices and complying with requirements of labour laws, while ensuring adequate measures are in place to protect the safety and well-being of our workforce.

I am pleased with the Company’s performance for the quarter in review, during which we have achieved strong profits despite intense competition. We credit this to the tireless efforts of all our team members, as well as our continuous improvement initiatives which enable us to keep enhancing our quality as well as operational and cost efficiency

We have begun FY2020 on strong footing, which sets a positive tone for the rest of the year. While it may be challenging and competitive, the new year will also bring opportunities which we are excited to leverage. Industry prospects remain promising. To ensure we are well-positioned to tap the growing glove demand, we will continue to prioritise R&D, innovation and Industry 4.0 initiatives enabling us to increase quality, operational efficiency and effectiveness, while keeping our customers satisfied and ultimately allowing us to deliver good results in the quarters to come.

Thank you.

TOP GLOVE, TOP QUALITY, TOP EFFICIENCY

GOOD HEALTH, SAFETY FIRST & BE HONEST

Tan Sri Dr Lim Wee Chai
17 December 2019