PETALING JAYA: Supermax Corp Bhd has reported a whopping 32-fold increase in net profit to RM789.52 million for its first quarter ended Sept 30, from RM24.75 million reported in the same period of the previous year attributed to the exponential increase in glove demand from the Covid-19 pandemic, as well as an increase in capacity and average selling price.
Revenue for the period soared 365.6% to RM1.35 billion from RM369.94 million reported previously. It highlighted that it is in a net cash position with cash & bank balances amounting to RM2.36 billion as of Sept 30, mainly due to high collections from increased sales where customers pay between 30% to 50% deposits in advance to secure supply.
According to the group’s Bursa filing, with the pandemic it has seen the emergence of new consumers and consumption that was not there before, putting it in a grossly oversold position.
It stated that the demand surge has led to a rapid rise in average selling prices (ASP) since March this year and this trend continues with the highest yet to be reflected in the current quarter.
Supermax has put into place expansion plans of building a total of five glove manufacturing plants between now and 2022.
“This will yield additional production capacity of 22.25 billion making a total of 48.42 billion gloves by end of year 2022. The Supermax Group will invest total capital expenditure of RM1.39 billion for the new plants,“ it said.
Aside from gloves, it also is making steady progress in its contact lens business, expanding to 65 countries which has resulted in an improvement of top line performance.
The group has also decided to venture into face mask manufacturing in Malaysia and Canada to complement its existing global supply chain starting with an initial capacity of eight million pieces a month.
In a separate filing, the group revealed that its proposed dual listing on the Singapore Stock Exchange is still in its initial stages and the structure of the proposal has not been finalised.
It explained that it aims to widen its investor base which includes foreign based institutional investors to take up future fund raising and future business expansion globally.
Supermax assured that more details relating to the dual listing will be made available in due course, if and when the board finalises the plan for, and approves, the listing.