KUALA LUMPUR: Comfort Glove Bhd’s aggressive cost saving measures and production improvement have paid off handsomely for the company, as net profit in the third quarter jumped on higher revenue.
The specialty glovemaker said it is now targeting to capture a bigger market share and improve its profit margins.
Earnings in the three months ended Oct 31 surged 44% to RM11.9mil from RM8.3mil a year ago, the company said in a filing with Bursa Malaysia on Wednesday, as revenue increased to RM106.5mil.
Net profit margin remained firm at 10%.
“The improved performance was mainly due to continuous projects on cost savings and upgrading of production lines to mitigate the impact of increased labour and energy cost,” it said.
The strong growth lifted its nine months net profit to RM31.1mil. Analysts had projected the company to make a full year net profit of RM35mil.
“Through dedication to process rationalisation and improving operational agility, the group is confident in capturing greater market share and strengthening margins,” Comfort Glove said.
Prospects for the rubber glove manufacturing sector remain strong with increasing demand arising from switching trends towards nitrile glove.
Nitrile glove now accounts for 61% of Malaysian rubber glove export.
Comfort Glove said as overall demand for nitrile gloves increases, the market is seeing increase segmentation and differentiation of products, leading to higher demand for its specialty products.