Comfort Gloves 4Q earnings double to RM9.39m

This article first appeared in The Edge Financial Daily, on March 27, 2019.
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KUALA LUMPUR: Comfort Gloves Bhd’s net profit for the fourth quarter ended Jan 31, 2019 (4QFY19) almost doubled to RM9.39 million, from RM4.78 million a year ago, when the group distributed RM3.4 million in shares through the employees’ share scheme.

Earnings per share rose to 1.67 sen, from 0.86 sen previously, the group said in a filing with Bursa Malaysia. Comfort Gloves said its quarterly revenue grew 23% to RM130.55 million, from RM106.36 million a year earlier. The group has recommended a final dividend of 1.5 sen per share.

For FY19, its net profit fell 22% to RM27.9 million, from RM35.9 million in FY18, due to a one-off logistic cost of RM5.4 million as well as a higher taxation and deferred taxation expenses of RM7.5 million.

“Our emphasis on natural and synthetic premium specialty gloves will continue providing the group with opportunities for growth and improvement. However, it will not mitigate the group from volatility in raw materials or an increased energy cost from a subsidy rationalisation,” Comfort Gloves said.

The group said it will continue to emphasise on research and development as the key method to expand its offerings and grow sales.

“Prospects for the rubber glove manufacturing sector remain strong with increasing demand arising from switching trends towards nitrile gloves. Nitrile gloves now account for 61% of Malaysian rubber glove exports.

“As overall demand for nitrile gloves increases, the market is seeing increasing segmentation and differentiation leading to higher demand for specialty gloves,” it added.

Comfort Gloves said through its dedication in a process rationalisation and an improving operational agility, it is confident of capturing a greater market share and strengthening margins.

“The group is confident that meeting customers’ expectations and continuous innovation will strengthen the group’s position as a bespoke specialty glove manufacturer,” it said.

Comfort Gloves’ share price fell two sen or 2.41% to 81 sen yesterday, with a market capitalisation of RM455.18 million.