a day ago
Top Glove optimistic on growing demand for gloves, additional sales from US
KUALA LUMPUR: Top Glove Corporation Bhd expects demand for gloves to grow with opportunities to capture additional sales from the United States when there is more clarity on issues surrounding US tariffs.
It also said the tariff imposed by the US on China products is unlikely to be lower than Malaysia's.
Managing director Lim Cheong Guan said the group's diverse portfolio is an advantage. It can offer a range to meet customers' preferences and pricing requirements while acknowledging competition in other regions.
'The final tariff decision by the US government will provide much-needed visibility for both manufacturers and customers,' he said in the group's virtual results briefing for the third quarter ended May 31, 2025 (Q3'25) today.
'Meanwhile, to mitigate the impact of US dollar volatility on profitability, we will maintain a consistent hedging policy on a month-to-month basis,' he said.
Lim also said quarterly fluctuations in average selling prices (ASP) are to be expected, influenced by raw material cost volatility, among other issues.
Nonetheless, market conditions are expected to stabilise over time, he said.
Overall, Lim said the group has a positive outlook for the glove industry and is confident of delivering stronger results in the coming quarters.
On the cost front, Lim said if raw material prices decline gradually, this would help ease some of the pressure from price competition.
At the same time, improvement in utilisation – 65% in June – is expected to rise in the coming months. This will help to optimise cost and boost competitiveness in the challenging market environment.
The 2% mandatory Employees' Provident Fund contribution for foreign workers would cost the group RM200,000 a month, he said.
'If you look at it in terms of average selling price, it will be 0.1% of the ASP,' said Lim.
For Q3'25, Top Glove saw its net profit decline to RM34.75 million from RM50.67 million a year ago. Revenue was higher at RM830.25 million versus RM636.87 million in Q3'24, it said in a filing with Bursa Malaysia.
Lim said the group's Q3'25 performance was impacted by pronounced headwinds, lower ASP, heightened competition, coupled with cost savings pass-through.
For the nine months ended May 31, 2025 (9M25), Top Glove returned to the black with a net profit of RM70.5 million against a net loss of RM58.23 million a year ago. Revenue was RM2.59 billion against RM1.68 billion in the same period last year.
In 9M25, sales revenue surged 55%, accompanied by a 65% increase in sales volume compared with 9M24. – Bernama
