KUALA LUMPUR (Sept 29): Karex Bhd has reported its first full-year net loss on record, blaming it on unavoidable operational expenses arising from the lockdown and higher distribution expenses.

The world's largest condom maker posted a net loss of RM1.02 million for the financial year ended June 30, 2021 (FY21), compared with a net profit of RM228,000 in FY20.

Revenue, however, rose 6.26% to RM419.82 million from RM395.07 million, primarily due to stronger condom sales in markets in the Americas and Asia.

For its fourth financial quarter (4QFY21), Karex registered a net loss of RM5.1 million against a net profit of RM1.43 million posted a year ago.

The group said the movement control order had negatively impacted its quarterly earnings, resulting in unavoidable operational expenses of RM4.2 million.

The impact of these production costs was further compounded by the continued disruption in global logistics networks, which resulted in additional distribution expenses of RM6.5 million.

Quarterly revenue, however, rose 17.16% to RM106.72 million in 4QFY21 from RM91.09 million a year ago, driven by higher sales contributions from the sexual wellness and medical segments.

On a quarter-on-quarter basis, Karex posted a bigger loss compared with RM3.17 million in the preceding quarter. Revenue, however, expanded 11.63% from RM95.61 million, due to several tender orders that were previously delayed by the global logistic disruptions delivered during the quarter.

On prospects, Karex said the recommencement of social interactions that have been absent for over a year in many countries is expected to drive the immediate term demand for condoms and lubricants amid vaccination rates ramp up around the world.

“In order to capitalise on new market trends that are expected to arise, the group is poised to expand its product portfolio in terms of capacity as well as variety to offer products such as medical gloves in the near future,” it added.

Karex’s share price settled 0.5 sen or 1.11% lower at 44.5 sen, for a market capitalisation of RM469 million.