Kossan 3Q net profit weighed down by lower prices, higher gas costs

Kossan 3Q net profit weighed down by lower prices, higher gas costs
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KUALA LUMPUR (Nov 21): Kossan Rubber Industries Bhd’s third quarter net profit slipped 9.18% to RM49.18 million or 3.84 sen a share, from RM54.15 million or 4.23 sen a share a year earlier, on lower average selling prices and higher natural gas costs.

Revenue for the quarter ended Sept 30, 2019 (3QFY19) was down 7.43% at RM531.26 million, versus RM573.9 million previously, the glove maker said in a filing with Bursa Malaysia.

For the cumulative nine-month period (9MFY19), Kossan’s net profit was 15.94% higher at RM163.78 million or 12.81 sen per share, from RM141.27 million or 11.5 sen per share last year, while revenue grew 5.69% to RM1.64 billion, from RM1.55 billion.

The improved performance for the period was due to higher demand growth for the group’s glove products, with higher volume sold (+9.21%) from increased production output, as well as increased manufacturing efficiency and effective cost controls, Kossan said.

On prospects, the group said the management is confident of achieving an improved performance in the final quarter of 2019, on the back of cost control, improvements in manufacturing technology and operating efficiency.

Kossan’s share price eased one sen or 0.24% to RM4.19 today, valuing the group at RM5.36 billion.