KUALA LUMPUR (Oct 21): Supermax Corp Bhd’s share price was in the red in Bursa Malaysia’s Thursday (Oct 21) morning trade after the US Customs and Border Protection (CBP) said the agency will detain imports of disposable gloves produced by the group's wholly-owned subsidiaries, namely Maxter Glove Manufacturing Sdn Bhd, Maxwell Glove Manufacturing Bhd and Supermax Glove Manufacturing, on forced labour allegations.
The stock opened at RM2.10, down 15 sen or 6.67% from Wednesday’s closing price of RM2.25.
At Thursday’s noon break, Supermax — the eighth top loser on Bursa — finished 23 sen or 10.22% lower at RM2.02, with some 59.75 million shares changing hands.
At RM2.02, the company had a market capitalisation of RM5.49 billion.
The counter had fallen 63.64% from when it was trading at RM5.51 apiece on Jan 4.
Earlier on Thursday, the US CBP issued a withhold release order against Supermax and its subsidiaries based on information that reasonably alleged use of forced labour in their manufacturing operations.
For the fourth quarter ended June 30, 2021 (4QFY21), the glove maker’s net profit surged 140% to RM958.71 million from RM398.83 million a year ago on the back of strong demand due to the Covid-19 pandemic, which saw higher sales from additional production capacity and continued increases in average selling prices from March 2020.
Similarly, its revenue for the quarter more than doubled to RM1.88 billion from RM929.12 million previously.
For the full financial year ended June 30, 2021 (FY21), the company's net profit saw a sevenfold increase to RM3.81 billion against RM524.8 million for the preceding financial year. Full-year revenue increased to RM7.16 billion from RM2.13 billion for the year before.
US Customs issues seize order on Supermax products on forced labour finding
US import ban expected to have significant impact on Supermax's earnings, say analysts