KUALA LUMPUR -- Top Glove Corporation has reported a huge surge in quarterly profits as the coronavirus pandemic played into the hands of the world's largest producer of latex gloves.
The Malaysian company posted net profit of $82.3 million for the three months ended May 31. That was treble its net profit in the prior quarter and a rise of 365% compared with the same period of the preceding year.
The company also registered $400 million in sales for the third quarter, an increase of 42% year-on-year. The sales and profits are Top Glove's best in its 29-year history.
The coronavirus pandemic has brought a surge in orders to the company, whose factories have been running almost around the clock to meet demand. Top Glove said lead times for orders had risen to more than a year.
"We are very pleased with our performance. It is easy to do well during good times but in tough times, companies that continue to do well are those with a solid foundation," said Lim Wee Chai, executive chairman.
Top Glove announced a first interim dividend of 10 sen per share.
The surge in profits means that for the first nine months of the year ending Aug. 31, Top Glove registered sales revenue $963.6 million, a 14% jump from the same period in the previous financial year. Profit after tax has jumped 97% to $135.8 million.
In a filing to the stock exchange, Top Glove said: "Monthly sales orders went up by some 180%, resulting in long lead times, which went up from 40 days to around 400 days, whereby orders placed now would only be delivered over a year later."
However, Top Glove said it managed to allocate capacity to as many countries as possible, to ensure its gloves reach those most in need, while also prioritizing existing customers, including requests from various governments that approached the company directly to procure gloves. Top Glove has more than 2,000 customers in 195 countries.
The glove maker said it has now secured its position as the world's largest maker of nitrile gloves, made of synthetic rubber, in addition to being the world's largest producer of natural rubber and surgical gloves.
In a recent interview with Nikkei, Lim said all of the company's 44 production facilities -- which employ over 18,000 -- were operating at almost 100% capacity to meet demand.
Since 1991, the company's compounded annual growth rates for revenue and profit have been 21.7% and 19% respectively. Top Glove was listed on the Kuala Lumpur and Singapore stock exchanges in 2001 and 2006, respectively.
Top Glove's 700 production lines have the capacity to turn out 73.8 billion pieces a year. The company claims a 26% share of the global rubber glove market.